The photo taken on September 18, 2022 shows customers at an Apple store in Yichang, Hubei Province. Photo: VCG

 
US tech giant Apple Inc has reported its latest earnings, showing that the Chinese market remained the brightest spot in the company's otherwise disappointing quarterly performance, underscoring the importance of China for Apple and many other foreign businesses as the Chinese economy continues to rebound.

Apple's strong performance in the Chinese market is in line with that of a number of other foreign businesses, including US coffee chain Starbucks, fast food chain Yum China and German sports clothing firm Adidas. That means foreign businesses will continue to expand in the Chinese market due to its appeal, which is a natural counterforce to the artificial "decoupling" or "de-risking" campaign pushed by some in the West, experts said. 

For the three months that ended on July 1, Apple's total revenue fell by 1.4 percent year-on-year to $81.8 billion, marking a third straight quarter of decline, according to the firm's earnings released on Thursday. Things could have been worse if it hadn't been for strong growth in the Chinese market. For the quarter, revenue from the Chinese mainland, Hong Kong and Taiwan, surged by 7.9 percent year-on-year to $15.8 billion, the brightest spot for the company. 

Apple CEO Tim Cook told Reuters that Apple's iPhone sales in China grew by "double digits" and that sales were also high in other segments in China. 

While sales in India also saw solid growth, the size of Apple's revenue in the Indian market is still significantly smaller than that of the Chinese market, experts noted. Moreover, India's protectionist policies also pose great uncertainty for foreign firms including Apple. Bloomberg reported on Friday that companies such as Apple and Samsung have halted new imports of laptops and tablets to India after an abrupt ban on inbound shipments without a license.

As one of the world's biggest tech firms, Apple's solid performance in the Chinese market offers an important indicator of foreign businesses' operations in China, analysts said, pointing to strong revenue growth in the Chinese market for many foreign businesses. 

Starbucks reported a strong recovery in the Chinese market in the quarter that ended on July 1, with net revenue rising 60 percent year-on-year to $821.9 million. Yum China, owner of the KFC and Pizza Hut chains in the Chinese mainland, reported a year-on-year revenue growth of 25 percent. Adidas also saw a revenue growth of 16 percent in China. 

Such strong performances in the Chinese market have helped these foreign businesses weather challenges in other markets, including in the US, amid a global downturn, and will further boost the Chinese market's attractiveness to multinationals, despite attempts by some in the West to cut business ties with China, analysts said. 

"Certainly, the momentum of China's economic recovery is obvious, and the rebound in performances of [foreign businesses in the Chinese market] have also boosted the attractiveness of the Chinese market to international brands," Pan Helin, joint director of the Research Center for Digital Economics and Financial Innovation affiliated with Zhejiang University's International Business School, told the Global Times on Friday. 

China's economic recovery will likely consolidate in the second half of 2023, and with China's continued efforts to expand market access, "I believe many [foreign businesses] will further expand their presence in the Chinese market," Pan said. 

Despite some Western officials' push for so-called economic decoupling or de-risking, many foreign businesses are continuing to increase their operations in China. 

"We'll double down on investment and product innovation, store experience, digitalization and people, to create even more distinct advantages to capture the limitless opportunities in China," said Belinda Wong, president of Starbucks China, which already operates nearly 6,500 stores in the Chinese mainland.

Overall, China's inbound foreign direct investment recorded a net inflow of $32.3 billion in the first six months of 2023, with significant growth seen in Chinese stocks, Wang Chunying, a spokesperson for the State Administration of Foreign Exchange, said on Friday. 

Chinese authorities have in recent days rolled out targeted policies to further improve the business environment for foreign businesses operating in the Chinese market, while vowing to continuously expand market access.