China continues to offer great sales growth opportunities for American companies investing there as the Chinese population becomes more affluent. No American company is likely to benefit more from this trend than Apple (AAPL).
Mainland China has the highest cell phone usage of any country in the world with the total number of wireless subscribers estimated at 940 million. The number of 3G subscribers (high speed) was recently estimated at more than 100 million and is expected to double to over 200 million in 2012.
Given this potential, let's look at some recent numbers from Apple Inc. regarding sales in China (including Hong Kong, Greater China and Taiwan):
Year (Fiscal) | 2011 | 2010 | 2009 |
Apple Total Sales ($ Millions) | $108.249 | $65,225 | $42,905 |
China Sales ($ Millions) | $12,472 | $2,764 | $769 |
China Sales as % of Apple Total | 11.5% | 4.2% | 1.8% |
Note that China now accounts for almost 12% of Apple’s total sales. In addition, as Apple’s sales grew 43 $Billion from 2010 to 2011, about 9.8 $Billion or 23% of Apple’s 2011 sales growth was in China. As Apple opens more and more retail stores in mainland China, Apple’s presence in the Chinese consumer market will continue to increase. With a smartphone market in mainland China growing more than 100% per year, you can easily see China accounting for at least 25% of Apple’s sales growth over the next 3-5 years.
Disclosure: I am long AAPL.
