The stock market today is an unholy mess. China’s main index dropped off a cliff, which sent the Dow Jones industrial average plunging 1,000 points this morning. The Dow has since recovered, but not before Apple stock fell below $100 for the first time this year. In an unusual move, Apple CEO Tim Cook emailed CNBC host Jim Cramer Monday morning to reassure investors that Apple is doing A-OK.
Cook said Apple doesn’t usually offer financial updates outside of its quarterly earnings reports, but today’s stock market rollercoaster seemed to warrant a response.
Here’s what Cook had to say:
As you know, we don’t give mid-quarter updates and we rarely comment on moves in Apple stock. But I know your question is on the minds of many investors.
I get updates on our performance in China every day, including this morning, and I can tell you that we have continued to experience strong growth for our business in China through July and August. Growth in iPhone activations has actually accelerated over the past few weeks, and we have had the best performance of the year for the App Store in China during the last 2 weeks.
Obviously I can’t predict the future, but our performance so far this quarter is reassuring. Additionally, I continue to believe that China represents an unprecedented opportunity over the long term as LTE penetration is very low and most importantly the growth of the middle class over the next several years will be huge.
Because Apple has been so aggressive about the importance of China to its future business, the company is now vulnerable to Chinese stock market turmoil and the recent devaluation of the yuan, China’s currency. Cook and co. seem confident that China remains a safe bet, but Apple watchers will be keeping a close eye on the country going into the holiday quarter. If the Chinese middle class isn’t buying up new iPhones, that would be very bad news for Apple.