Apple beats estimates despite China lag

The news: Tech giant Apple's quarterly sales and profit have beaten analyst estimates, driven by an uptick in iPhone sales.

The numbers: Revenue for the fiscal first quarter ending December rose 2% to USD119.60 billion ($182 billion), ahead of analysts expectations and also ending a run of four quarters of revenue decline. Profit per share also rose to USD2.18, also beating estimates. Sales of iPhones hit USD69.70 billion, growing 6% to beat analyst expectations of $67.82 billion.

The context: Apple shares dropped 1% in after-market trading, after having risen 1.3% in regular trade. The biggest growth area during the quarter was its services business, which includes the Apple TV+ service as well as music, iCloud storage and the App Store. The company said sales in China came in at USD20.82 billion, missing analyst estimates by a wide margin. Analysts are increasingly worrying about sales of Apple's signature device in China, whose economy is navigating the burst of a real estate bubble. The iPhone also faces increasing competition in China and has fallen out of favour in government offices. In the rest of Asia beyond China and Japan, Apple's sales hit a better-than-expected USD10.16 billion.