Here’s why Tim Cook says not to worry about huge iPhone miss in China

Apple just reported earnings for the all-important holiday quarter. Overall it was Apple’s best quarter ever, but iPhone sales didn’t quite hit expectations, mainly because of China. CEO Tim Cook’s key takeaway though: iPhone 16 sales were strongest in countries where Apple Intelligence was available.

iPhone 16 sold better in countries with AI support, per Cook

There’s been a lot of discourse around whether consumers truly care about Apple Intelligence or not.

The company’s AI and iPhone 16 rollouts were initially praised, but would they drive upgrades?

Per CEO Tim Cook to CNBC, it seems that the answer is yes.

Apple CEO Tim Cook told CNBC’s Steve Kovach that iPhone sales were stronger in countries where Apple Intelligence is available. Currently, the software is only available in a handful of English-speaking countries, and it isn’t accessible in China or in Chinese. 

“During the December quarter, we saw that in markets where we had rolled out Apple intelligence, that the year-over-year performance on the iPhone 16 family was stronger than those markets where we had not rolled out Apple intelligence,” Cook said.  

Currently, Apple Intelligence isn’t available at all in China. It’s also unavailable on iPhones or iPads in the EU—that, at least, will change in April with iOS 18.4.

China, however, has no announced release date for AI. And its iPhone 16 sales took a hit as a result.

Cook told CNBC that there were three factors in the company’s China performance. He said that half of the 11.1% decline was due to a change in “channel inventory,” the fact that Apple Intelligence hasn’t launched in the region and that after the quarter ended, China issued a national subsidy that would stimulate some Apple product sales.  

This last reason at least indicates that there may be an iPhone boost in the upcoming quarter. But if Cook’s narrative around AI driving iPhone sales is correct, it may be short-lived growth without an announcement of Apple Intelligence coming to China.

What do you think of Cook’s correlation of iPhone 16 sales and Apple Intelligence? Let us know in the comments.

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