Apple’s Greater China segment, which covers China mainland, Hong Kong and Taiwan, had $82.378 billion of net sales in fiscal 2026, 17.2% of Apple’s total, according to the Form 10-KApple filed on 3 November. Of each dollar, 42.9 cents became segment operating income, 53.9 cents went to cost of sales and 3.3 cents to selling and marketing, by our arithmetic from the segment note.
That 42.9% segment margin was the lowest of Apple’s five regions. China ties into Apple in three ways the filing describes separately: as a market, as a source of segment profit and as a manufacturing base. This analysis puts the three together, using the 10-K and our earlier pieces.
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Greater China’s share of Apple’s fiscal 2026 net sales (17.2%), five-segment operating income (16.6%), net sales growth (28.7%) and segment operating incomegrowth (22.9%). Source: Apple’s fiscal 2026 Form 10-K segment note; shares are our arithmetic. Chart: FourWeekMBA.
The key insight: By our arithmetic from the fiscal 2026 10-K, Greater China was 17.2% of Apple’s net sales and supplied 28.7% of its revenuegrowth, and 42.9 cents of each Greater China sales dollar became segment operating income, the lowest of Apple’s five regions.
Greater China net sales rose 28% in fiscal 2026, from $64.377 billion. The region supplied $18.001 billion of Apple’s $62.673 billion revenue increase, or 28.7%, as we reported on 2 November.
Apple wrote that the growth was “primarily due to higher net sales of iPhone and Mac”. The 10-K also says its revenue mix was “generally consistent for each reportable segment” “except in Greater China, where iPhone revenue represented a moderately higher proportion of net sales”.
Over a longer run the region shrank as a share of Apple. It was 25.1% of net sales in fiscal 2015, against 17.2% in fiscal 2026, as our 10-K series showed.
Where each dollar of Apple’s Greater China net sales went in fiscal 2026: $47.1 billion of cost of sales and selling and marketing, and $35.3 billion of segment operating income, 42.9 cents on the dollar. Source: Apple’s fiscal 2026 Form 10-K segment note; the split per dollar is our arithmetic.
China as a Margin
The segment table splits Greater China’s $82.378 billion into $44.362 billion of cost of sales, $2.690 billion of selling and marketing and $35.326 billion of segment operating income. Research and development and general and administrative costs sit in a separate Corporate column, so segment profit is before those costs.
By our arithmetic, the fiscal 2026 segment margins were 47.4% for Japan, 46.1% for Rest of Asia Pacific, 45.5% for Europe, 43.4% for the Americas and 42.9% for Greater China. The region ranked second every year from fiscal 2015 to fiscal 2023, as our margin piece found.
Greater China was 16.6% of the five segments’ combined operating income of $212.468 billion, and supplied $8.409 billion, or 22.9%, of its $36.791 billion increase, by our arithmetic.
China as a Supply Base
The 10-K says: “Substantially all of the Company’s hardware products are manufactured by outsourcing partners that are located primarily in China mainland, India, Japan, South Korea, Taiwan and Vietnam”. It does not split production by country.
Two lines on Apple’s books tie it to those partners. Manufacturing purchase obligations were $89.7 billion on 26 September, with $82.7 billion payable within 12 months, as we covered in Apple’s purchase commitments.
Vendor non-trade receivables, money the companies that buy components for Apple owe it, were $39.896 billion, a record we reported in Apple’s vendors owe it a record $39.9B. The 10-K says they were “concentrated among a few individual vendors located primarily in Asia”. Two vendors accounted for 45% and 27%, or about $28.7 billion together, by our arithmetic.
Apple’s own long-lived assets table for fiscal 2026 lists only the U.S., at $41.386 billion, and other countries, at $10.698 billion. It has no China row, as our margin piece noted.
Where AI Enters
Apple said on 31 October that its first Apple Intelligence features are coming to users in China, with Alibaba’s Qwen supported in some experiences, as we covered in Apple brings 18 AI features to China with Alibaba’s Qwen. The same 10-K rewrote a risk factor to add “compute capacity and storage resources” to the components Apple says it must obtain, as we reported on 4 November.
As we read the 10-K, Apple’s China exposure has two sides that its tables report separately: the segment measures where Apple sells, while the manufacturing obligations and vendor receivables measure what it owes to, and is owed by, the partners that build its hardware.
As we read the segment note, the region grew faster than the rest of Apple in fiscal 2026 while earning the lowest segment margin of the five, so its weight in revenuegrowth (28.7%) was larger than its weight in segment profitgrowth (22.9%), by our arithmetic.
Apple Inc., Form 10-K, fiscal 2026
“Substantially all of the Company’s hardware products are manufactured by outsourcing partners that are located primarily in China mainland, India, Japan, South Korea, Taiwan and Vietnam”
Three Implications
FOR THE MARKET SIDE Greater China was 17.2% of fiscal 2026 net sales, against 25.1% in fiscal 2015, as our earlier piece reported.
FOR THE MARGIN SIDE The segment turned 42.9 cents of each sales dollar into segment operating income, the lowest of five regions, by our arithmetic.
FOR THE SUPPLY SIDE The 10-K lists manufacturing purchase obligations of $89.7 billion and vendor non-trade receivables of $39.896 billion, without a split by country.
The framework says: “The digital economy rests on a physical foundation that most people in that economy never see.”
As we read it, Apple’s 10-K shows that foundation on both sides of its China exposure: a sales segment it reports in detail, and a manufacturing base it describes by location but does not split by country. The framework does not discuss Apple.
The segment shows where Apple sells, not where its products are made. The 10-K does not say how much of the $89.7 billion of manufacturing obligations, or of the vendor receivables, relates to partners in China mainland. Segment operating income excludes research and development and general and administrative costs, so it is not the region’s full profit.
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By our arithmetic from the 10-K, Greater China was 17.2% of Apple’s fiscal 2026 net sales, supplied 28.7% of its revenuegrowth and turned 42.9 cents of each sales dollar into segment operating income, the lowest of five regions. On the supply side, Apple says substantially all its hardware is made by outsourcing partners located primarily in China mainland, India, Japan, South Korea, Taiwan and Vietnam, and its books carry $89.7 billion of manufacturing obligations and $39.896 billion of vendor receivables.
A note on sourcing. Segment figures, purchase obligations, vendor receivables and quotations are from Apple’s Form 10-K for fiscal 2026, filed with the SEC on 3 November 2026. Figures attributed to earlier pieces come from those pieces, which cite Apple’s filings. Shares, per-dollar splits and margins are our arithmetic.
Gennaro Cuofano is a CRO and tech executive who has worked in AI since late 2015, starting with bringing NLP, natural-language generation, voice and chatbot products to the marketing industry. His background is in law and finance: he holds a Master's degree in Law and an International MBA with an emphasis on corporate finance (LUISS Business School and the University of San Diego, 2012), and worked as a financial analyst at a real-estate investment firm in San Diego and as an assistant controller. His work focuses on business model strategy, business engineering and, more broadly, structural analysis: how companies make money, read from their own filings. He created FourWeekMBA and leads research there and at The Business Engineer, his newsletter on AI and business strategy, with over 95,000 subscribers and more than 1,000 published analyses. His writing has also appeared on Entrepreneur (for example, How to Digitize a Family Business in Europe) and HackerNoon. Find him on LinkedIn and Substack. See how we source.
