8 takeaways from Apple’s Q4 2016 earnings call

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Tim Cook
iPhone sales were down in Q4 2016.
Photo: Ste Smith/Cult of Mac

Apple can’t make enough iPhone 7 devices to satisfy demand from customers (and from Wall Street to make more money).

During Apple’s Q4 2016 earnings call today, Apple CEO Tim Cook and CFO Luca Maestri hinted that big things are in the pipeline that should put the company back on track to growth — and it all starts Thursday with the MacBook Pro.

Here’s what we learned from the Q4 earnings call:

What to expect from Apple earnings call Q4 2016

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money
Apple will reveal Q4 2016 earnings on October 25.
Photo: Ste Smith/Cult of Mac

During tomorrow’s Apple earnings call, Tim Cook is likely to unload some bad news. Wall Street expects Apple to report its first annual revenue decline since 2001, snapping one of the most impressive streaks ever witnessed.

Slumping iPhone sales mean Apple’s annual revenue could drop to $215.67 billion for 2016. That would be a significant decline from the $233.72 billion in revenue Apple posted in 2015 — but there may be light at the end of the tunnel.

Apple beware: Chinese phones are taking over the world

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iPhone 7
iPhone shipments fell last quarter.
Photo: Ste Smith/Cult of Mac

For the second quarter in a row, Chinese smartphone makers produced more phones than market leaders Apple and Samsung, according to a new Q3 shipment volume report from global market research firm Trendforce.

Apple saw its iPhone volume production fall 5.3 percent from the three months previous, while Samsung registered minor growth of 1.3 percent. Chinese smartphone makers on the other hand? A quarterly increase of 18 percent.

This doesn’t quite tell the whole story, though.

Apple will open a second R&D center in China next year

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china-defends-its-new-anti-encryption-law-image-cultofandroidcomwp-contentuploads201512Screen-Shot-2015-12-23-at-164347-png
Apple is upping its focus on China.
Photo: Apple

Apple has announced plans for its second R&D center in China, located in the country’s manufacturing hub Shenzhen. The 2017 opening will help Apple further grow its market in the world’s second largest economy as it challenges local competition.

“We are excited to be opening a new Research and Development center here next year so our engineering team can work even more closely and collaboratively with our manufacturing partners,” Apple spokesperson Josh Rosenstock said.

Apple joins board of ‘Chinese Uber’

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Didi Chuxing is China's answer to Uber, but is much bigger. Apple just made a $1 billion 'strategic' investment in the company.
Apple's "strategic" investment is paying off.
Photo: Virginia Werner / Cult of Mac

Apple has scored a seat on the board of Didi Chuxing, the Chinese Uber rival that Apple invested $1 billion in earlier this year.

Although Didi Chuxing denied it at the time, regulatory filings show that Apple took the board position in late June, one month after it made its generous investment — designed to aid Apple’s continued push into China and interest in shaking up the automotive industry.

Apple will open its first R&D center in China later this year

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Apple's new R&D center will reportedly employ 500 people.
Photo: Meinhardt Group

Apple has reportedly set up its first R&D center in China, located in Beijing’s Zhongguancun Science Park, according to a statement issued by the Zhongguancun Park Management Committee.

The plan is for the center to hire a total of 500 employees, who will focus on a wide range of Apple products and devices including, “the development of computer software and hardware products, communication, audio and video devices, as well as advanced technologies for consumer electronics products and the information industry.”

Apple’s iPhone 7 slogan in Hong Kong? ‘This is penis’

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jet black iphone 7 plus
Well, that's one way to sell the new iPhone 7.
Photo: Apple

Tim Cook says that Apple designs its new products with the Chinese audience in mind. However, judging by one of the translated slogans for its new iPhone 7, that same localized care and attention doesn’t extend to every aspect of Apple’s business

The proof? One of the slogans for the iPhone 7 is apparently being read by some audiences as “This is penis.”

Hey, at least iPhone 7 Plus owners can feel good about themselves!