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Apple Inc. (AAPL - Free Report) yesterday revealed that it is strengthening its foothold in China with a new research and development (R&D) center at the Shenzhen manufacturing hub, according to media reports.

Per the Shenzhen Economic Daily, CEO Tim Cook made the announcement at an innovation event he attended in China. The report also stated that Apple is looking forward to tap the city’s skilled workforce, specifically the software developers.

An Apple executive commented "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." He also added "The Shenzhen center, along with the Beijing center, is also aimed at strengthening relationships with local partners and universities as we work to support talent development across the country."

China remains an important market for Apple, given the increasing number of middle-class customers. Apple believes that China, which is already the second largest iPhone market, will grow into a major contributor to its total revenue but it does face tough competition from a number of strong local players like Huawei Technologies, Vivo and OPPO among others

Though the last two quarters have been marked by sluggish growth, the company remains optimistic about the long-term growth prospects of the region. The company had earlier revealed that in the past one year, the installed base of iPhones in the country increased over 34%.  This has led the company to invest significantly in the market ($1 billion in the ride-hailing company DidiChuxing) and also open more retail stores in the region (at the end of the third quarter there were 41 stores). In Aug 2016, the company had announced its plans to set up an R&D center in Beijing.

Currently, Apple is a Zacks Rank #3 (Hold) stock. Some better-ranked stocks in the broader tech space include Finisar Corp. (FNSR - Free Report) , Intel Corporation (INTC - Free Report) and Applied Materials, Inc. (AMAT - Free Report) . All sport a Zacks Rank #1 (Strong Buy). You can see the complete list of today’s Zacks #1 Rank stocks here.

The Zacks Consensus estimate for Finisar surged 63.5% over the past 30 days for the current fiscal. Intel has seen estimates for the full year rise 3.6% over the past 30 days. For Applied Materials, estimates rose 13.6% in the last 60 days.

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