President Trump\u2019s recent executive order of banning WeChat and its parent company Tencent is expecting to have a detrimental impact on the technology industry. Among the giant tech companies, Apple could have far-reaching consequences as it is deeply entrenched in China.<\/p>\n\n\n\n
According to a new research note from a respected KGI Securities analyst Ming-Chi Kuo, Apple\u2019s yearly global iPhone shipments could drop as much as 30% if it is forced to pull out WeChat from its App Stores. <\/p>\n\n\n\n
Kuo added that WeChat is a popular and useful app in China, integrating functions such as messaging, e-commerce, social networking, and news reading. Banning this app that has served a daily necessity to many smartphone-users can lead to a decline in Apple\u2019s hardware product shipments in the Chinese market. He wrote that an estimate of a 25-30% decrease in the annual iPhone shipment could happen. Yearly shipments of other Apple tech devices, such as iPad, AirPods, Apple Watch, and Mac, may also decline by 15-25%.<\/p>\n\n\n\n
Apple has a broad Chinese customer base, and nearly most of its essential assembly and manufacturing partners are based in China. Trump\u2019s ban might not only compel Apple to pull out WeChat from its App store – which would hurt Apple\u2019s Chinese smartphone business – it could substantially change how Apple can create and sell its new products in the future. <\/p>\n\n\n\n
To hundreds of millions of Chinese WeChat app users, an iPhone without the app is effectively not a phone at all. If Apple is forced not to offer WeChat on its iPhone due to Trump\u2019s executive order, then much of Apple\u2019s Chinese businesses might disappear in an instant. <\/p>\n\n\n\n
According to Kuo, if Apple were to remove WeChat only from the U.S. App Store, there could be a more modest decrease in global iPhone shipments, between 3-6%, with other Apple products decreasing less than 3%. Based on its most recent third-quarter results, Apple\u2019s revenue associated with Greater China is around $9.3 billion, which went up from $9.1 billion in last year\u2019s quarter. <\/p>\n\n\n\n
Kuo recommends that investors decrease their stock holdings in Apple\u2019s supply chain, including Genius Electronic Optica and LG Innotek, due to the WeChat ban\u2019s uncertainties. However, things might still change as the prohibitions indicated in the executive order do not take effect until the 20th of September. There is still time for the executive order to be modified, clarified, or rescinded.<\/p>\n","protected":false},"excerpt":{"rendered":"
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Abdon","author_link":"https:\/\/futuresharks.com\/author\/viena\/"},"uagb_comment_info":0,"uagb_excerpt":"President Trump\u2019s recent executive order of banning WeChat and its parent company Tencent is expecting to have a detrimental impact on the technology industry. Among the giant tech companies, Apple could have far-reaching consequences as it is deeply entrenched in China. According to a new research note from a respected KGI Securities analyst Ming-Chi Kuo,…","_links":{"self":[{"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/posts\/24839"}],"collection":[{"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/users\/3378"}],"replies":[{"embeddable":true,"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/comments?post=24839"}],"version-history":[{"count":0,"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/posts\/24839\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/media\/24841"}],"wp:attachment":[{"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/media?parent=24839"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/categories?post=24839"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/futuresharks.com\/wp-json\/wp\/v2\/tags?post=24839"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}