Apple’s shares plummet after Beijing ban on iPhones: Report

Following reports that China, one of the company’s major markets, had prohibited government personnel from using iPhones as Beijing intensifies its continuing tech war with the US, Apple shares plummeted during after-hours trading on Thursday, following the company’s greatest single day loss in a month, according to a report by Forbes.

In after-hours trading, Apple shares were down 2.62 per cent at 5:01 a.m., according to the report. This fall came after a 3.6 per cent drop in New York on Wednesday, which Bloomberg reports was Apple's greatest single-day share price drop in just over a month. This decline defied a general upward trend for tech equities this year, during which the business had increased by 46 per cent.

It follows Wednesday’s claims that China had forbidden central government employees from using or bringing iPhones into the office, as well as this week’s launch of a new smartphone from Chinese company Huawei that may pose a threat to Apple’s dominant market share.

Add WION as a Preferred Source

Presently, Apple is widely regarded in China, but it is facing criticism on several fronts. The unveiling of a high-speed competitor gadget from Huawei and the rumoured ban on iPhones in government buildings are two actions that could spell disaster. It might hurt sales in a crucial market that has been vital to the business’ success lately and contributed to the $74 billion in income it brought in previous year.

Apart from sales, Apple is at risk due to its dependence on Chinese manufacturing (nearly all major devices are made there), and the possible hostility from Beijing signalled by the ban could significantly impede its worldwide supply chain.

It is unclear how strictly Beijing’s iPhone ban would be enforced by the authorities. The Wall Street Journal, which broke the news of the prohibition, noted that it was unknown how broad it would apply and that it was an enlargement of a previous limitation that had been in effect at a small number of government agencies for years. While noting that certain central government authorities had received similar instructions, it stated that the order's reach was unknown.

Bloomberg hinted at a far wider extent when it confirmed the news on Thursday; both publications cited unnamed persons knowledgeable with the situation. According to Bloomberg, restrictions would apply to “a plethora of state-owned enterprises and other government-controlled organisations,” a designation that may include a broad range of institutions given Beijing’s influence over society, government, and the economy.

(With inputs from agencies)

WATCH WION LIVE HERE