Apple attributed much of its decline in China business to the impact of a strong dollar< /strong>
Apple has pinned its hopes on artificial intelligence for iPhone upgrades in the coming months to help it recover from a sales slowdown that has hit its China business particularly hard. .
CEO Tim Cook, speaking on a conference call Thursday about third-quarter results, said the upcoming Apple Intelligence features will give customers a new reason to buy new phones.
“It's going to be a very important time for an exciting upgrade cycle,” he told analysts.
The remarks followed generally upbeat third-quarter results that were however hit by sluggish sales in China. Apple returned to revenue growth in the second quarter, up 5% to $85.8 billion, beating analysts' estimate of $84.5 billion.
But sales from China fell by 6.5% to $14.7 billion, missing Wall Street's forecast of $15.3 billion.
The company's stock fluctuated in trading after reporting corporate results, while it has gained 13% year-to-date, boosted by investors' hopes that new artificial intelligence technology will help boost sales.
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The comeback of the iPad
Apple's iPad unit benefited from the much-anticipated launch of new models. The company introduced major upgrades in May after a slowdown in sales for its tablet line. The new products included a more expensive iPad Pro with an M4 chip, as well as a faster version of the iPad Air with a larger screen option.
The Cupertino, California-based company reported revenue of $7.16 billion in that category, up 24%, and beat the $6.6 billion estimate.
In addition to the new iPad Pro and iPad Air, Apple is working on versions of its main iPad and iPad mini with faster processors. This could trigger additional upgrades when they roll out sometime in the coming months.
Apple Intelligence
The company also introduced Apple Intelligence last quarter, showing the new AI tools at its developer conference in June. However, the technology – aimed at iPhones, iPads and Macs – is not expected to be released to customers until October.
Apple also has yet to explain how it plans to monetize the features, beyond boosting demand for compatible devices. And the technology won't be available in China to begin with.
The services sector, which includes the App Store, Apple Music and streaming platform TV+, continues to be a growth factor. It had sales of $24.2 billion last quarter, up 14%.
