What’s Going On Here?Apple reported better-than-expected results late on Thursday, so at least the tech giant will be able to foot the bill for its fancy new payments service. What Does This Mean?Apple’s fourth quarter is always an important one, not least because it reflects sales during the all-important holiday period. Well, those last-minute spending sprees went down a treat: iPhone sales – the company’s biggest money-spinner – were up by a better-than-expected 9% versus the same time in 2020. In fact, sales of almost every one of Apple’s products grew from the year before, despite the supply chain problems. And then there’s its highly profitable services segment: revenue from the home of Apple TV, iCloud, and Apple Music climbed by a better-than-expected 24%, which helped bring in a record total revenue of $124 billion. Why Should I Care?Zooming in: The smartphone market is shrinking.
All this growth had plenty to do with China: data out earlier this week showed that Apple became the biggest smartphone seller in the country for the first time in six years last quarter. The tech giant boosted its Chinese sales by a third, helping it claim a record 23% of the country’s smartphone market even as that market shrank. That’s a trend Apple might want to get used to: analysts expect rising prices, shortage-stunted supply, and consumers’ increasing tendency to delay phone upgrades to drag on smartphone sales across the world.
The bigger picture: Pay Apple.
Apple’s got a few tricks up its turtleneck to offset that potential slowdown, including pushing further into the payments space. Business owners currently need to use their iPhone alongside a payment machine to process transactions, but Apple’s reportedly planning a new service that would let them use – you guessed it – just the iPhone. That’s worrying news for major payment providers like Block that could see demand for their terminals drop off, which might be why investors sent the company’s shares down after the announcement. | 
