Apple shares experienced a 4% dip on Wednesday, and a further fall of about 3% on Thursday.
This was as a result of multiple reports suggesting that Chinese government workers could be banned from using iPhones.
On Wednesday, it was reported that China has ordered officials at central government agencies not to bring iPhones into the office or use them for work.
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 the bans had been extended to state-backed firms, including energy giant PetroChina.
PetroChina employs millions of workers and controls vast swaths of the Chinese economy.
Analyst at Bank of America Wamsi Mohan has however tagged the timing of the ban “interesting”.
He observed that the iPhone ban interestingly coincides with the release of a new high-end flagship smartphone by Chinese manufacturer Huawei. The Mate 60 Pro.
Priced at $960 for presale, the new smartphone is scheduled to launch just a few days before Apple is scheduled to release its iPhone 15 lineup. A ban on all government employees could reduce iPhone unit sales in China by only a little 5%.
However, according to Bernstein analyst Toni Sacconaghi, the ban can pose a larger threat to Apple if it sends a signal to everyday citizens that they should instead use electronics made by Chinese companies.
Already, investors have fearfully dumped the stock from Wednesday and Thursday — reducing the company’s market value by nearly $200 billion.
China accounts for roughly 40-50mn iPhone units for Apple.
Greater China, including Hong Kong and Taiwan, is Apple’s third-largest market.
It is also where the vast majority of Apple products are assembled.
Apple derived more than 19% of its $395billion revenue from the Greater China region in its latest quarter.
According to the analysts, Apple could lose up to 10 million iPhone shipments in 2024 because of the new Huawei phone. Coupled with lost shipments due to the government ban in China, Apple could be looking at 15-20 million in lost iPhone shipments for the next year.
