SHANGHAI, CHINA – MARCH 21: Tim Cook dinner, chief government officer of Apple Inc., arrives for opening ceremony of the brand new Apple Jing’an retailer on March 21, 2024 in Shanghai, China. The brand new Apple retailer opens on March 21 in Shanghai’s Jing’an district. (Picture by VCG/VCG by way of Getty Pictures)
Vcg | Visible China Group | Getty Pictures
Apple may double down on the China smartphone market amid declining iPhone gross sales and stiff competitors within the nation, Wedbush Securities mentioned on Monday.
Apple wants to beat its China challenges together with a tricky macro surroundings and competitors from Huawei earlier than the iPhone 16 launch and “all of it begins with reaffirming Apple’s presence in China,” Wedbush mentioned.
China’s Minister of Commerce Wang Wentao met Apple CEO Tim Cook dinner on Friday and mentioned his nation holds alternatives for Apple in addition to different firms, and requested the iPhone maker to maintain constructing its enterprise in China for “shared growth,” in line with a press assertion.
Cook dinner mentioned China was a vital provide chain associate for Apple and the corporate plans to extend funding within the nation in the long run, the assertion mentioned.
Final week, Cook dinner opened Apple’s latest flagship retailer in Shanghai on Thursday and met with key suppliers in China, in line with media stories. He additionally attended the China Growth Discussion board in Beijing, as China seeks to woo international traders amid regulatory and international uncertainties.
Cook dinner’s newest journey to China, which Wedbush mentioned is “an indication Apple may double down” on China, comes amid stories of iPhone gross sales in China plunging 24% within the first six weeks of 2024.
Apple is working in a difficult surroundings in its largest abroad market, China, because it faces stiff competitors from native Chinese language smartphone makers, significantly Huawei, whose shopper enterprise is experiencing a resurgence within the nation after the launch of its Mate 60 smartphone.
“The timing of this journey was vital as in essence Apple wants China and China wants Apple regardless of all of the noise,” Wedbush mentioned.
Covid-19 lockdowns in China in late 2022 majorly disrupted Apple’s provide chain, which prompted the tech agency to diversify a few of its manufacturing to international locations reminiscent of India and Vietnam.
“Nonetheless, the overwhelming majority of its iPhone manufacturing and suppliers will stay in China,” Wedbush mentioned whereas sustaining its “outperform” ranking and a $250 value goal on Apple.
Apple is at the moment going through regulatory challenges within the U.S. and EU and whereas its gross sales have dropped in China this 12 months, the corporate final 12 months emerged because the nation’s greatest smartphone provider.
The U.S. Division of Justice sued Apple on Thursday, alleging the tech agency illegally maintains a monopoly over smartphones. The EU on Monday opened an investigation into Apple in relation to the so-called anti-steering guidelines.
