Apple slips as China reportedly orders government agencies to stop using iPhones

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The Chinese government has reportedly told government agencies to stop using Apple (NASDAQ:AAPL) iPhones and other foreign electronic devices at work, the latest sign in the ongoing dispute between the U.S. and China.

Staff of the government agencies were told in workplace chat groups or meetings to stop using the devices, The Wall Street Journal reported, citing people familiar with the matter.

The news outlet added that it is not clear how wide the orders were distributed, but similar messages were mentioned at certain government regulators.

The Chinese government has restricted the use of some agencies using iPhones for work, but the directive looks to have been widened and sends a signal that it will be enforced, the news outlet explained.

Apple (AAPL) shares fell more than 3% in mid-market trading on Wednesday.

According to its most recent quarterly results, Apple (AAPL) generated $15.75B in revenue from Greater China. Of the nine months ended July 1, Greater China accounted for $57.48B in revenue for Apple.

Cupertino, California-based Apple (AAPL) did not immediately respond to a request for comment from Seeking Alpha.

The move could be seen as a retaliation by the Chinese government as the U.S. government has banned the use of certain Chinese products and services by government agencies in recent years, including TikTok and Huawei.

In May, Montana became the first U.S. state to ban TikTok for private citizens, with the law set to go into effect next year.

The U.S. has also imposed export curbs on semiconductor and semiconductor equipment sales to China (with Japan and the Netherlands following), all in the name of national security.

In July, the influential Semiconductor Industry Association trade group - whose members include Intel (INTC), AMD (AMD), Nvidia (NVDA) and more - said it asked the Biden Administration to eschew further restrictions on semiconductor sales to China.

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• Apple: Tim Cook's Plan To Revive Growth Is Here
• Alphabet, Amazon, Apple listed among 'gatekeepers' by European Commission
• Strong sales of Huawei Mate 60 in China could impact iPhone, BofA says
• Apple partner Foxconn says August revenue drops 8%, forecasts stronger Q3

Comments

[TripLiars]

Aha! Chinese government is working in concert with Huwai to steal Apple iOS by blackmailing it to give up source code under excuse of security flaw and hack that they themselves attempted. After stealing Nortel tech and running it under ground, stealing F35 and making copycat, Chinese government is after apple tech. And we have many unpatriotic analysts helping China by creating false negative narrative and putting pressure on the stock price of us companies.

[mag1205]

@TripLiars
U.S. Govt. allows this kind of thievery by China by simply letting Chinese people steal American technology for money from Chinese.

Chinese Govt. through it's agents is on a buying precious agricultural land in hundreds of thousands of acres in midwest & who is going to stop them?
Venting my steam.

[Bill West]

Go look at this YouTube vid on the new China Huwawei 5g phone starting at $900usd.
There is no way in hell a China iPHone buyer will buy this as their primary phone. Look at the vid and the lack of quality......

www.youtube.com/...

[TripLiars]

@Bill West China is good at stealing intellectual property from us.

[Bill West]

Good chart on new iPhone 15 specs....
macdailynews.com/...

[Natturner1966]

Good luck with BRICS. Hasta la vista baby.

[ble373]

China is in a bind between Capitalist dependent membership and Authoritarian-atorship.
It's interesting that a Chinese boycott on Iphone is their national security issue.
The most populous country objects to a US corporate spying capable product. The US Security agencies are quiet, ehh. Either they did it or they have the key.
My issue is the investment portfolio prospectus never mentioned spying on me. Now I have no issue doing it elsewhere, but more and more there appears to be different rules here. Chinese state officials get no Iphones, but our Iphones are what, OK?
You see where I'm headed?

[combatcorpsmanVN]

AAPL employs millions of Chinese in China. Chinese government is in dire straits as a result of centralized mandates in the Real Estate sector. In other words, many unfulfilled contracts for housing is stirring public unrest. "I paid for an apartment (etc) that's not being built and I can't get my money back" is giving the Government panic attacks. Pile on threats about AAPL and Pandora's box may give Xi a whole lot more to worry about if unemployment in the tech sector becomes reality.

AAPL isn't a problem for China; unless China makes AAPL a problem and fiddling with the phone citizens want to buy doesn't sound like a good idea to me.

[nate311]

@combatcorpsmanVN all you say makes sense except freedom of speech in china is non-existent. whisper something too loud that xi doesn't like and you may well never be heard fr again. best do what he says or else. lesson: don't be bragging about or showing off your iPhone...

[Blowback2]

Ummm…APPL will be just the start…what goes around…..!

[nate311]

@Blowback2 the start of what? western cos have had enough of Chinese IP theft. the exodus has been occurring for 18 mos. the trickle has turned into an increasingly larger stream, soon to be a deluge. china will be the loser. it's already dealing w/dreadful youth unemployment...it's sure to worsen.

[dstb]

The key here is "and other foreign electronic devices at work." So it isn't just Apple and people can still use them elsewhere. Overhyped story. Now the EU crackdown is a real problem for Apple's business model.

[GibraltarAssetMgmt]

just the beginning ...
US and China
when countries don't agree

[TripLiars]

@GibraltarAssetMgmt china is asking for a death sentence from us companies

[TripLiars]

Fake news and overreaction.

[milehr]

Apple's presence in corporate computing (or should I say AI?) is still minuscule, and it is practically zero in government. No issue whatsoever.

[TripLiars]

@milehr it’s going to come in like droves. Great systems, very reliable and performant

[IBottheDip]

Anyone buying AAPL today down $189 to $177 on this China 🇨🇳 govt ban news? Seems over sold with iPhone 📲 show next week. I couldn’t resist in at $177

[nate311]

@IBottheDip apple's the greatest biz ever but the dip didn't bring apple's valuation anywhere near attractive. i believe you overpaid at 177 but for your sake, I hope I'm wrong.

[Bill West]

iPhone users not going to give them up.....
Buy a cheap Gubbermint approved phone and put your iPhone on a VPN app...

Apple is on sale, Luca will be buying today....

[Charlot- 2020]

@Bill West Who is Luca?

[Pianodude]

@Charlot- 2020 Apple CFO

[Charlot- 2020]

@Pianodude Ok, thank you!!

[BasedCapitalist]

Meanwhile most people in US government agencies are using made-in-China iPhones. 🤔

[kata]

@BasedCapitalist Maybe the US govt will follow suit and mandate IPhones.

[nate311]

@BasedCapitalist curious how you went about doing your survey?

[Et20]

@BasedCapitalist

Assembled.

[HardCovenant]

Huawei Mate60 slogan should be "Every breath you take, every party meeting you fake, every step you make, we'll be watching you"

[S_Archer]

@HardCovenant just like those spy nanobots in my COVID Vaccine. they are spying on me LOL

[nate311]

@HardCovenant brilliant! hope you're providing royalties to sting.

[Elon the GOAT]

Take this chance to ban iPhone exports to China

[Redsson]

@Elon the GOAT given they are mostly assembled in China, that would be an interesting step. A cell phone is not really a strategically critical piece of military kit.

[S_Archer]

@Elon the GOAT I think you meant exports to US. 95% of Iphones are built and stored in China. No part of an Iphone is made in US. the Box is even made in China

[le9n]

Same as Tesla ! See what happened in Tesla. In long term it is nothing for aapl.

[Natturner1966]

US Secretary of Commerce just left from over there. Man, she really scared them didn’t she? NOT.

[jsantmyer]

@Natturner1966 they don’t think much of a women trying to impersonate a male politician. Can’t blame them, this one is at least as ignorant as Kamala and that is saying something. Fire all of these Socialist Liberals…

[nate311]

@jsantmyer come on, no one's as ignorant as kamala!

[jsantmyer]

@nate311 you make a great point. You WIN!

[Basit Saliu]

Never going to invest in Apple or Disney or any other company except for the companies I am a customer and fan of- Alphabet, Microsoft, and British American Tobacco, and also commodities. (To lesser extent I will also incest in Sony)

[078956]

@Basit Saliu terrible investment criteria

[W0rthy]

@078956 Not so fast… “incest”ing with companies may just be a profitable and enjoyable strategy. Let’s run the numbers… (can it be back tested?)

[All*AAPL]

@Basit Saliu: "Never going to invest in Apple or Disney or any other company except for the companies I am a customer and fan of- Alphabet, Microsoft, and British American Tobacco, and also commodities"

**British American Tobacco? I'll stick with AAPL...they don't make/sell products that can make you sick or possibly kill their customers when used as designed.

[combatcorpsmanVN]

Tit for Tat — Tempest in a Teapot.