Apple’s market valuation fell by more than $200 billion this week following reports that the Chinese government is cracking down on iPhone use among government workers.
Shares of Apple rose slightly in Friday’s session, closing at $178.18, but were down more than 6 percent on the week after Beijing ordered employees at some central government agencies to stop using iPhones at work .
The tech giant’s market capitalization was $2.79 trillion – still the most valuable publicly traded company in the world, but down from the high-water mark of more than $3 trillion earlier this year.
China’s crackdown on the iPhone comes at a time of rising tensions between Washington and Beijing, showing that even Apple’s longstanding good relationship with the Chinese government may not protect the company from geopolitical headwinds.
“Beijing is trying to reduce its dependence on US technology, but this ban is a significant headwind for Apple as China is its largest international market and accounts for about 20 percent of its sales,” said Victoria Scholar, head of investments at interactive investor , a British investment platform.
Apple’s market value fell by more than $200 billion this week after reports that the Chinese government is cracking down on iPhone use. Apple CEO Tim Cook is seen above
Apple shares fell more than 6 percent from the week after reports that Beijing had ordered employees of some central government agencies to stop using iPhones
When asked about the iPhone ban during a daily briefing in Beijing, Chinese Foreign Ministry spokesman Mao Ning made no direct comment, saying only that “products and services from any country are welcome at the Chinese market, as long as they comply with Chinese laws’. and regulations.’
Apple did not immediately respond to a request for comment from DailyMail.com on Friday.
Friction between the US and China has worsened in recent years, as Washington seeks to limit China’s access to key technologies, including cutting-edge chip technology, and Beijing seeks to reduce its dependence on US technology.
Early last month, President Joe Biden signed an executive order imposing blocks and regulations on US high-tech investments in China.
White House officials said Biden, who left for New Delhi on Thursday evening, will use the annual G20 summit as an opportunity to make clear that the United States and its like-minded allies are better economic and security partners than China.
Apple also faces increasing competition from China’s Huawei, which launched two new smartphones that attracted global attention for their resilience to US sanctions.
Huawei’s foldable Mate
The US Commerce Department said late Thursday that it is working to obtain more information “about the character and composition” of the Huawei chip that may violate trade restrictions.
Customers were able to check out Huawei’s new phones last week at a store in Yantai, Shandong province. Huawei launched two new smartphones despite the US export ban on advanced chips
Visitors pass the renovated flagship Apple Store in Shanghai. Last week marked the 30th anniversary of Apple entering China, which has become the largest market for the iPhone
The new Huawei phones reportedly have enough power and speed to rival the iPhone and are selling well in China. The Mate 60 costs 5,999 yuan ($817.70), the same as Apple’s iPhone 14 in China.
Some analysts believe Huawei’s moves could be a first step in the comeback efforts of China’s “national champion” to rival Apple, after the company gained some market share following US sanctions rolled out four years ago over the fears that the devices could endanger national security.
“We believe that Huawei’s activity this time was well prepared and not sudden,” said Ivan Lam, an analyst at Counterpoint, whose outlook for the new products exceeded previous estimates.
“It can control the psychological expectations of the target group before Apple’s press conference.”
Apple will roll out a new iPhone on Tuesday after a weak quarter for sales of its flagship product.
A teaser of the livestream for the event, called ‘Wonderlust’, has been posted on YouTube and does not reveal any details.
Rumors are swirling that big changes are in store for the iPhone, including a switch from Apple’s Lightning connector to the USB-C plug that rivals are starting to adopt, partly in response to a mandate from the European Union.