Apple Shares Drop Nearly 6% in China After iPhone Ban Report, Sales May See 5% Decline
After the ban on iPhone usage by government employees in China, Apple’s shares witnessed a continuous decline. In the past two days, the company’s shares dropped by nearly 6%. On Thursday, they closed at $177.56, down by $5.35 or 2.92%.
China is Apple’s third-largest market, contributing 18% of the total revenue of $394 billion in the past fiscal year. Most of Apple’s products are also manufactured in China. The ban on government employees could potentially lead to a 5% drop in iPhone sales in China.
Ban on iPhone Usage by Chinese Government Officials
Two days ago, The Wall Street Journal reported that China has imposed a ban on the use of devices from American company Apple and other foreign manufacturers. However, this ban is said to apply only to government officials. Officials have been instructed not to bring these devices into their offices or use them for work.
The Chinese government has urged officials to use domestically manufactured phones instead. According to the report, China did not specify any other phone manufacturers besides Apple. So far, Apple has not provided any official response to this development. Meanwhile, the Chinese government has not provided any further information about the ban’s implementation.
Apple’s Wanderlust Event Faces Preceding Ban
China has imposed a ban on the use of iPhones by government officials, just ahead of Apple’s scheduled ‘Wanderlust’ event in California on September 12. The event is expected to launch the Apple iPhone 15 series alongside the Apple Watch Series 9 and Apple Watch Ultra 2.
Russia Accuses the U.S. of Spying on iPhones
Three months ago, Russia had accused the U.S. of spying on iPhones. Apple had vehemently denied all allegations, stating, ‘We have never collaborated with any government to compromise phones, and we never will.
Apple Considers Shifting 18% of iPhone Manufacturing to India
Apple is contemplating shifting 18% of its global iPhone production to India by 2025. According to the Bank of America report, India’s Production-Linked Incentive (PLI) scheme is encouraging Apple to enhance its manufacturing capabilities in the country.
The Bank of America report states that the PLI scheme not only benefits Apple but also helps India. This initiative aims to increase local production of mobile phones threefold by 2026, generating $126 billion in output and $55 billion in exports, with the goal of reducing reliance on imports.
Amid geopolitical tensions and the COVID-19 pandemic, Apple and other American tech giants have been expanding their manufacturing facilities outside China.
