Apple falls on the stock market due to iPhone ban in China

The actions of Apple Inc. suffered their worst drop in a month following a report that Chinese government agencies had banned staff from using iPhones and other foreign-branded devices at work.

The employees of “some“Central government regulators received instructions via chat groups and meetings to stop bringing such devices into the office, The Wall Street Journal reported, citing people familiar with the matter. The scope of the issuance of the warrants is unclear, the newspaper added.

The shares fell 3.3% to $183.53 on Wednesday in New York, representing the biggest intraday drop since August 4. This year, as of Tuesday’s close, Apple shares had advanced 46%, part of a broader rally in technology stocks.

The company enjoys great popularity in China, its biggest international market, despite growing resentment of US efforts to contain the Asian country’s technology industry. Apple’s iPhones are among the best sellers in the country and are common in both the government and private sectors.

However, the use of foreign devices in sensitive agencies has long been discouraged, particularly as Beijing stepped up a campaign in recent years to reduce reliance on technology from the United States, China’s geopolitical rival.

However, last quarter, China was one of the highlights in the results of Manzanaas they helped offset a generally slow period. The Cupertino, California-based company is preparing to unveil its latest iPhones next week, setting the stage for a holiday quarter that is invariably the busiest sales period of the year.

No more iPhone at work

The Chinese government prohibited all government officials and official agencies from using iPhones during working hours, the US newspaper The Wall Street Journal (WSJ) revealed on Wednesday, citing sources familiar with the case.

Neither Apple -the company that produces the iPhone- nor the Chinese government have yet confirmed this ban, which appears to be a retaliatory measure for the restrictions imposed in the United States on Huawei phones or the TikTok network.

Beyond the political reasons, this ban could be a severe blow to Apple, which has 19% of its global profits in China, with the iPhone being the preferred high-end phone in the Asian country.

According to the newspaper, the limitations on the use of the iPhone were already applied, but this time they have become a state policy, all within a context of growing commercial and political rivalry between the United States and China.

Thus, the Government of Beijing has urged all government offices to opt for the national product in its purchasing policy for computers, operating systems and all types of software, among other things -according to the newspaper- to thus ensure that the government will have greater control over its users.

As early as 2021, the Chinese government imposed restrictions on Tesla electric vehicles for members of its armed forces or strategic companies for fear that they would be a source of security leaks, but that did not stop Elon Musk’s company vehicles from continuing to be sold. at a good pace in the country.

Until now, Apple had bowed to numerous exceptions in its products for China in the field of digital freedoms, accepting that its iPhones did not include numerous applications in its “store” due to government imposition, nor VPNs that allow them to circumvent those censorships.

With information from Bloomberg and EFE