FirstFT: Apple sales beat expectations despite China decline

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Good morning. We start today with the latest results from Apple, which surpassed analysts’ downbeat expectations but showed more warning signs about its business in China.

The tech company yesterday reported revenue of $90.75bn in the past quarter, down 4 per cent from the year before but slightly ahead of consensus estimates for $90.3bn. Apple also announced another $110bn in share buybacks and raised its quarterly dividend by 4 per cent.

Net sales in the greater China region were $16.3bn for the quarter, compared with $17.8bn a year ago.

Shares bounced more than 7 per cent higher in after-hours trading. This year, Apple’s stock has fallen about 7 per cent and it has once again lost its position as the world’s most valuable listed company to Microsoft.

The company has had a rocky start to the year, with the cancellation of its years-long car project, mounting pressure from US and EU antitrust enforcers and rising competition in China from lower-cost rivals such as Xiaomi and Huawei. Here’s more on Apple’s results and its challenges in China.

And here’s what I’m keeping tabs on today and over the weekend:

• Economic data: Hong Kong and Singapore report March retail sales, while jobs figures are due in the EU and US. S&P Global publishes its services purchasing managers’ index for Australia. Thailand releases its monthly consumer price index.

• Chinese lunar mission: China is set to launch a robotic spacecraft to the far side of the moon today to collect rock and soil samples. (Reuters)

• Japan PM in Latin America: Fumio Kishida is due to meet Brazilian President Luiz Inácio Lula da Silva in Brasília before travelling to Asunción for a visit with Paraguayan President Santiago Peña. On Saturday he’ll be back in Brazil to address an economic forum in São Paulo.

• Xi Jinping in Europe: China’s leader begins a five-day trip to Europe on Sunday, his first visit to the region since 2019, with stops in France, Serbia and Hungary.

• Holiday: Financial markets are closed today in Japan for Constitution Day.

How well did you keep up with the news this week? Take our quiz.

Five more top stories

1. Hong Kong’s financial regulator has launched criminal proceedings in an insider dealing case against hedge fund Segantii Capital Management and its founder Simon Sadler and former trader Daniel LaRocca. The charges relate to dealing in the shares of an unnamed company listed on the Hong Kong Stock Exchange before a block trade in June 2017. Here’s what we know about the case and Segantii’s block trading business.

• Fired SocGen Hong Kong trader hits back: A Société Générale trader dismissed over unauthorised risky bets has lashed out at the French bank, saying the “entire risk team and other bosses” were equally responsible and complaining his bonus had been withheld.

2. US law firm Mayer Brown is to split its China operations from its global network, becoming the latest law company to rethink its business there as market conditions remain weak and tensions fray with the US. Mayer Brown, one of the world’s top-grossing law firms, is working on a plan to hive off its Hong Kong, Shanghai and Beijing offices, according to two people close to the firm.

3. Russia shipped more than 165,000 barrels of refined petroleum to North Korea in March in defiance of UN sanctions, the White House said yesterday. The US is preparing sanctions to target those aiding such transfers between the two countries, and also condemned Pyongyang’s shipments of ballistic missiles to Moscow, which has been using them in its war against Ukraine.

4. Sony and private equity group Apollo have told Paramount Global they intend to make a $26bn cash offer for the entertainment company, just one day before an exclusivity window is set to expire for a competing bid from Skydance Media. The Japanese group behind the rival Sony Pictures studio would be the majority investor in the deal and have control, while Apollo would be a minority equity investor, according to two people briefed on the approach. Here’s more on the offer.

5. The Solomon Islands has picked former top diplomat Jeremiah Manele as its next prime minister. Manele was the Pacific country’s foreign minister as it pursued closer ties with China, but analysts suggested he could be more conciliatory towards the west than outgoing premier Manasseh Sogavare. “He [Manele] may have an open ear,” said Mihai Sora of the Lowy Institute. 

Visual story

Stalled western aid and Russia’s success in a primarily land-based war have made for a tough start to the year for Ukraine. But in the Black Sea, Kyiv continues to make progress. Despite having no real navy, Ukraine has disabled or destroyed a third of Russia’s Black Sea fleet over the past two years. Our latest visual story explores Ukraine’s striking naval success and its strategic and economic importance for a country dependent on seaborne trade.

We’re also reading . . . 

• TikTok and Tesla: Both Washington and Beijing juggle security fears with commercial interests and political influence in their treatment of the companies, writes John Thornhill.

• Japanese economy: The battering sustained by the yen since January is causing fears in some quarters of the emerging economy bogeyman, writes Leo Lewis.

• Berkshire after Buffett: The second part of our series on the company’s future looks at Ajit Jain, the risk “genius” running Berkshire Hathaway’s insurance operations.

Chart of the day

High flows of immigration into rich countries are helping to strengthen jobs markets and bolster growth, the OECD said yesterday, as it lifted its outlook for the global economy. 

Take a break from the news

Miami’s new Messi Experience is a nine-room, walk-through extravaganza of AI, 3D and CGI dedicated to arguably the greatest footballer of all time. Could it offer a glimpse of the future of visitor attractions? Or might it simply be a headache-inducing assembly of video screens and special effects? Ruaridh Nicoll visits to find out.

Additional contributions by Tee Zhuo and Gordon Smith