Shares of the world’s largest publicly-traded company saw a 2.8 percent decline, reaching $177.79 during late morning trading. This drop followed a 3.6 percent decrease on Wednesday, triggered by a Wall Street Journal report revealing China’s prohibition of Apple smartphones in central government agencies. Subsequently, a Bloomberg News article on Thursday announced China’s intention to extend this ban to government-backed entities and state-run corporations, expanding its impact within a centrally-planned economy.
Both Apple and Chinese officials have refrained from providing comments in response to AFP requests. This development unfolds against the backdrop of escalating tensions between Beijing and Washington.
According to the Bloomberg report, Chinese state media celebrated the release of a Huawei smartphone featuring a domestically-produced processor, viewing it as a significant achievement amid US sanctions.
In the most recent quarter, Apple recorded $15.8 billion in revenue from China, accounting for nearly 20 percent of its total revenues. Company executives highlighted increased sales in China, contrasting with an overall sales decline during that period.
Briefing.com analyst Patrick O’Hare noted that the Apple situation could have implications for other technology companies.
“The worry for the market is that, if China purposely chooses to make business difficult for a company like Apple, which has a good and important working relationship in China, then it can do so for a lot of other US companies doing business in China,” O’Hare said.
But Wedbush Securities analyst Dan Ives estimated that a Chinese government ban would affect less than 500,000 iPhones of roughly 45 million projected to be sold in the country in the next year.
“We believe despite the loud noise Apple has seen massive share gains in China smartphone market,” Ives said, adding that rising sales give Apple “incremental momentum on this front.”
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