The most obvious way to read Apple’s latest quarterly earnings report — which revealed that iPhone sales in China had surpassed those in the U.S. for the first time — is as a compilation of great news about the company’s bottom line. But it’s also a sign that China’s consumer market is finally starting to come into its own. It might even mark China’s so-called “Henry Ford moment,” when a sizable portion of the country’s workers can finally afford to buy the things they’re manufacturing.
It’s still a bit too early to definitively draw that conclusion. Apple’s statistics may have been skewed by the post-Christmas lull in the U.S., which coincides with the peak Lunar New Year shopping season in mainland China.
But there’s no reason to think the upward trends for China’s middle class will reverse anytime soon. Apple’s sales figures seem to confirm recent studies by the Asia Society Policy Institute and the Rhodium Group, which showed that Chinese incomes are rising faster than official data indicate. As Apple CEO Tim Cook has pointed out, “I’ve never seen as many people coming into the middle class as they are in China and that’s where the bulk of our sales are going.”
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