Apple lost $200 billion in two days after reports of iPhone ban in China

[beijingwalker]

Apple lost $200 billion in two days after reports of iPhone ban in China​

cnn.com Technology Sep - 10 - 2023 , 11:40
Shares of Apple fell by 2.9% on Thursday following reports that China plans to expand a ban on the use of iPhones to government-backed agencies and companies.

Investors are fretting over the ability of the world’s most valuable public company to do business in the world’s second-largest economy.

Apple (AAPL) notched its largest daily fall in over a month on Wednesday. The company lost about $200 billion in two days, and its stock is currently the worst performer in the Dow Jones Industrial Average.
The bans could be an ominous sign for Apple.

China is the largest foreign market for the company’s products, and Chinese sales represented about a fifth of the company’s total revenue last year. Apple doesn’t disclose iPhone sales by country, but analysts at research firm TechInsights estimate that there were more iPhone sales in China than in the United States last quarter. Apple also produces the majority of its iPhones in Chinese factories.

Cupertino, California-based Apple also plays an important role in Beijing’s economy, wrote Brandon Nispel, an analyst at KeyBanc Capital, on Wednesday. Because of that, the company “has historically been viewed as relatively safe in China from government restrictions.” These reported bans present an important question, he wrote: “Is the government changing its stance?”

On Wednesday, the Wall Street Journal reported that China had banned the use of iPhones for central government officials and that managers had been notifying staff of the ban via chat groups or meetings.
On Thursday, Bloomberg reported that those bans had been extended to state-backed firms, including energy giant PetroChina, which employ millions of workers and control vast swaths of the Chinese economy.

Analysts at Bank of America wrote in a note Thursday that the potential iPhone ban comes on the heels of a new high-end flagship smartphone released by Chinese manufacturer Huawei. The timing, said analysts, is “interesting.”

The US government said Tuesday it was investigating the new smartphone. National Security Adviser Jake Sullivan said during a White House press briefing that the United States needs “more information about precisely its character and composition” to determine if parties bypassed American restrictions on semiconductor exports to create the new chip.

Tech companies fell on the news, the Nasdaq Composite dropped by about 0.9% on Thursday and the semiconductor sector fell by more than 2%.

Apple lost $200 billion in two days after reports of iPhone ban in China

Shares of Apple fell by 2.9% on Thursday following reports that China plans to expand a ban on the use of iPhones to government-backed agencies and companies.

www.graphic.com.gh

 

[retaxis]

Tesla and then Apple lol whose next?

Elon musk is even batting for Russia and turn off gps for ukraine lol

 

[beijingwalker]

Apple suppliers slide on China anxiety, threat from Huawei​

Apple is facing stepped-up competition from China's Huawei, which launched two new smartphones - the foldable Mate X5 and the Mate 60 Pro+ - that drew global attention for showcasing resilience to U.S. sanctions.​

By: Reuters
September 10, 2023 09:14 IST

China’s widening curbs on iPhone use by government staff intensified a sell-off in global tech stocks on Friday on fears Apple and its suppliers could take a hit from rising Sino-U.S. tensions and growing competition from Huawei.

Apple shares tumbled 6.4% in the previous two days, wiping $190 billion from its market capitalisation, following news Beijing ordered some central government employees in recent weeks to stop using iPhones at work.

Several Wall Street analysts on Friday said the selloff was overdone, claiming that any revenue hit for Apple would likely be small due to the phone’s popularity in China. After two days of declines, Apple shares rebounded in Friday trading, up 1.3%.

Apple is facing stepped-up competition from China’s Huawei, which launched two new smartphones – the foldable Mate X5 and the Mate 60 Pro+ – that drew global attention for showcasing resilience to U.S. sanctions.

Some analysts believe Huawei’s moves could be a first step in comeback efforts by China’s “national champion” to rival Apple after it took some market share following U.S. sanctions rolled out four years ago. Apple is set to roll out a new iPhone on Tuesday following a weak quarter for sales of its flagship product.

“We believe Huawei’s activity this time was well prepared and not sudden,” said Ivan Lam, an analyst at Counterpoint, whose outlook for the new products exceeds previous estimation. “It can manage the psychological expectations of the target consumer group before Apple’s press conference.”

China has been a bright spot for Apple, its third-largest market behind the Americas and Europe, in an otherwise tough period for iPhone sales. Huawei’s smartphone business was decimated after the United States curbed tech exports to it in 2019.

Apple’s sales in China this year have been helped by rare deals launched by its third-party retailers in February that offered discounts on its iPhone 14 Pro by as much as 10%. However, analysts told Reuters that those discounts could end up undermining sales of Apple’s new products set to launch in the coming days.

In Taipei, Apple supplier Largan Precision, which makes camera lenses, dropped more than 4%, while contract chipmaker TSMC fell 0.6% on Friday. China’s Luxshare Precision Industry, owner of factories capable of making iPhones, fell 2%.

Shares of U.S.-based Apple suppliers were little changed on Friday, with Qualcomm up 0.1% and Broadcom down 0.4%.

Huawei suppliers extended recent gains. Shares in Semiconductor Manufacturing International Corp (SMIC) , which is believed to have made the advanced chip in Huawei’s new smartphone, rose 0.7%.

SCOPE OF CURBS UNCLEAR

It was not immediately clear how wide China’s iPhone curbs are, but one employee at an affected state-owned enterprise (SOE) in the capital said they extended to visitors.

“Anyone, including business visitors, who enters our work area cannot bring in their iPhones,” said the source, one of two SOE employees who said they were told of the ban in recent weeks.

The source, who spoke on condition of anonymity, said the company was giving employees a subsidy of 100-200 yuan ($13-$26) to switch to local brands. Some staff at other SOEs, however, told Reuters they had not been banned from using iPhones.

While the number of central government employees is not public, Bank of America estimated that such a ban could cut iPhone sales by 5 million-10 million units a year from China’s annual total of up to 50 million.

Huawei’s smartphone sales driven by the new Mate 60 Pro could jump 65% this year to 38 million in the absence of some “non-commercial risks,” said Ming-Chi Kuo, an analyst at TF International Securities.

However, Canalys analyst Nicole Peng said Huawei could present a greater threat to domestic peers, and Morgan Stanley’s Erik Woodring on Friday said, “Apple’s ecosystem in China remains very strong,” with the average iPhone owner in China owning 2.5 Apple devices.

Several Wall Street analysts said the curbs showed that even a company with a large presence in China and good ties to the government is not immune to rising tension between the two nations. Apple has shifted some production out of China in the aftermath of the country’s strict COVID-19 restrictions.

“The only way Apple could draw the ire of Beijing is moving supply chains out of China at a pace or to a degree Beijing feels uncomfortable with,” Evercore ISI strategist Neo Wang said in a note.

“If that is the case, it shouldn’t be a surprise for Beijing to punish Apple by playing the ‘security’ card excessively. It is unclear whether what we are seeing now is part of this,” Wang said.

Washington is trying to limit China’s access to key advances, including cutting-edge chip technology, and Beijing wants to cut reliance on American tech.

A teardown by research firm TechInsights showed more China-made chip components in the Mate 60 Pro than previous models, a sign of Beijing’s progress.

The U.S. Commerce Department is seeking more information on the “character and composition” of the new Huawei chip that may violate trade curbs, it said on Thursday.

Apple suppliers slide on China anxiety, threat from Huawei

Apple is facing stepped-up competition from China's Huawei, which launched two new smartphones - the foldable Mate X5 and the Mate 60 Pro+ - that drew global attention for showcasing resilience to U.S. sanctions.

indianexpress.com

 

[Menthol]

Buy Apple shares before iPhone 15 launch!

This is the right moment.

 

[FourMikeEcho]

Apple did not lose the money. Its future upside in terms of future earnings is impacted because of this decision, so investors feel the shares are worth slightly less than they were. Stock price went down $10 when it was $189 before.

No organization wants to see its customer base evaporate. US Govt did this for TikTok and now China is doing what it feels it appropriate.

It's just not as big a consequence since market cap is still $2.8Trillion.

 

[Nan Yang]

Quote
Apple, with hundreds of billions of dollars in capital, has been unable to break through Qualcomm's patent wall on this particular technology, but Huawei seems to have done it.


Apple Renews Qualcomm Deal in Sign Its Own Modem Chip Isn’t Ready

• Pact between the companies had been scheduled to end this year
• The iPhone maker has been trying to create its own components

Apple Extends Chip Deal With Qualcomm

By Ian King and Mark Gurman

September 11, 2023 at 4:30 AM PDT

Apple Inc. is extending an agreement to get modem semiconductors from Qualcomm Inc. for three more years, a sign that its ambitious effort to design the chips in-house is taking longer than expected. Qualcomm shares surged on the news.

The new pact will cover “smartphone launches in 2024, 2025 and 2026,” Qualcomm said in a statement Monday. The companies’ agreement had been set to end this year, and the latest iPhone — due on Tuesday — was expected to be one of the last to rely on the Qualcomm modem chip.

 

[Hamartia Antidote]

LOL! This is the one month chart. They just are back down from an up bounce.

1 month

1 year

5 year

 

[Han Patriot]

LOL! This is the one month chart. They just are back down from an up bounce.

View attachment 952885
1 month

View attachment 952886
1 year

View attachment 952887
5 year

Copium. Stocks go up and down all the time, but 200 bil drop after just one news? That's brutal.

 

[Hamartia Antidote]

Stocks go up and down all the time,

exactly just look at the super brutal beginning of August drop

 

[Han Patriot]

exactly just look at the super brutal beginning of August drop

View attachment 952894

The point is one stupid Chinese chip caused a sudden 200 bil drop. That's a B. Interesting times ahead man.