in

Ming-Chi Kuo: global iPhone shipments could fall 30 percent following WeChat ban

2019-04-23-image-27.jpg


In a nutshell: Donald Trump’s recently signed executive orders prohibiting US transactions with WeChat and parent company Tencent could take a significant bite out of Apple. Cupertino’s massive Chinese userbase relies on the app for their everyday lives, and should it no longer be available on iPhones, the handsets’ annual global shipments could fall by 25 – 30 percent.

It was last week when President Trump issued orders that would prohibit “any transaction by any person, or with respect to any property, subject to the jurisdiction of the United States,” with TikTok owner ByteDance along with WeChat and parent Tencent.

WeChat has become a necessity in China. Not only is it used for its primary function of communications, it’s also a digital payment service, news source, vital for conducting business, and more.

Apple analyst Ming-Chi Kuo warns that if the company is forced to remove WeChat from its App Store globally, iPhone shipments could decline by a massive 25 to 30 percent while products such as AirPods and iPads will drop by 15 – 25 percent. Should the ban only cover the US, handset shipments will fall by just 3 to 6 percent, with other hardware dropping by less than 3 percent.

Kuo recommends investors reduce their holdings in companies part of Apple’s supply chain, such as LG Innotek and Genius Electronic Optical, such will be the impact of the WeChat ban.

We still don’t know the extent of the prohibitions against WeChat and what they will entail. Owner Tencent has full ownership of Riot Games and a 48 percent ownership of Fortnite-maker Epic Games, as well as investments in Tesla, Reddit, Spotify, and others, so a ban could have a huge impact across the industry. A US official did say, however, that the order against WeChat blocks transactions involving the app and is not a broader ban against Tencent, but we’ll have to wait a while before things become clearer. Either way, Apple and many other tech giants will be concerned.



Source link

Written by sortiwa

71RtmcIqJRL._SL1500_-1.jpg

Amazon Freedom Sale: Top 5 PC Monitors you can buy under Rs 10,000

airtel-jio-vodafone-recharge-1200-1-1.jpg

Airtel vs Jio vs Vodafone: Best prepaid plans with 84 days validity