What’s Behind Apple’s Sales Slump And Dire China Warning?

Apple is having a rough time in China. We have sort of a collection of items going on. Some that are macroeconomic and some
that are Apple specific. Do you have to wonder whether this some respects opens the floodgates now to more companies, more CEOs coming out and cutting their numbers as a result of the trade war and weakness in China and elsewhere? Apple remains one of the biggest and most powerful companies in the world and iPhone sales remain its most important metric. So when iPhone sales slumped in China, it means billions of dollars lost and it rattles markets across the world. There are three big factors dragging down Apple in China. China’s economy is slowing down. China became the second largest economy in the world and lightning speed but cracks are beginning to show. Car sales are shrinking. Recent
manufacturing data are slowing and the Chinese stock market posted its worst
year in a decade in 2018. Wall Street fears that could mean that growth in China and the rest of the world is slowing more quickly than anticipated. Apple products are expensive and a weak economy means fewer people buy them. China has the world’s largest smartphone
market. With more than 1.3 billion people and a fast growing middle class, that’s
to be expected. And Apple’s far from the only game in town. There’s Huawei, Oppo, Xiaomi and OnePlus those are only some of the need of Chinese smartphone makers the consumers there can choose from. They’re cheaper and Chinese consumers don’t have the same kind of brand loyalty as American smartphone buyers. Apple’s also facing competition from itself. Fewer and fewer iPhone owners are upgrading to newer more expensive models. Instead they’re upgrading batteries and holding on to older models for longer
and longer. On top of all of this, the United States and China remain locked in a trade war and I may finally be taking a toll on the already slowing Chinese economy. China’s GDP growth slowed in the third quarter, posting the weakest pace
since the financial crisis. President Trump and China Xi Jinping agreed to a
90 day trade war truce in December that ends in March. But tensions haven’t let
up. I have felt all along something that no one wants to talk about. Which is? The
Communist Party doesn’t want you to buy Apple. The tariffs rolled out by the United States in 2018, did not directly target Apple’s iPhones but the company warned
in September of that same year that they would hurt sales in other areas, like the Apple watch and Home Pod. This time though, Apple CEO Tim Cook says the trade tensions exacerbated economic conditions in China and have reached consumers and by extension the iPhone. If you look at our results, our shortfall is over a 100% from the iPhone and it’s primarily a greater triumph. And so as we look at what’s going on in China, the, it’s clear that the economy began to slow there for the second half. And what I believe to be the case the trade tensions between the United States and China put additional pressure on their economy. And so we saw as the quarter went on, a things like traffic in our retail stores, traffic in our channel partner stores, the reports of the smartphone industry contracting, particularly bad in November, I haven’t seen the December number yet but I would I would guess that that would not be good either. So while all eyes remain on Apple, the story of slowing global growth may soon envelop more and more American companies.

100 thoughts on “What’s Behind Apple’s Sales Slump And Dire China Warning?

  1. Apple’s worst mistake is keeping its design office in California, far removed from its competition and carefully protected from new innovation

  2. The more Chinese see Americans being anti Chinese with Chinese companies. The more they become anti American against American companies.

  3. I switched to Motorola Android. Still does everything I need at half the price. So now I can afford to upgrade every year again. Bye bye Apple.

  4. The middle east and the terrorism boogeyman will be forgotten.
    On to the game, a global economical war against China for the next 20 years. And I already know how it will unfold.

  5. Go check the latest phones from Huawei, Vivo, Oppo, Oneplus, Nubia, etc. and their global sales number, you should know why.

  6. Actually chinese phone makers provide more expensive models that are seen as social status symbols in China. For example, Huawei partner with Porsche and provide Huawei Porsche version, which could cost over $3000. another Chinese phone maker Oppo has a special model Find X lamborghini with leather case…

  7. Why would I upgrade for minor camera updates? I bought a 6s plus at its launch and changed its battery and it still works. Also I really do want to upgrade to a new Apple device but there aren't any major changes from Apple yoy compared to Android. Most probably will shift to galaxy S10. Apple is no longer what it once used to stand for I.e. innovation

  8. Overpaying for yesterday’s technology and 10 years old iOS interface that i have no control at all is sickening

  9. Iphones is not worth to upgrade every year… Iphone 6 still worth to used……

  10. Chinese companies make better phones. In China, only the lowest and some middle class people using iPhone, the rich people use Huawei, Xiaomin and etc.

  11. Its simple stop jacking up the price. Consumer are not stupid 40% price increase in 2 years just plain greedy. Ppl will look for the alternative.

  12. Well I use iPhone solely for iMessage and FaceTime. Chinese people use WeChat so I don't see why Chinese people would buy an iPhone over any other brand

  13. I switched to android months ago, can't see myself ever going back to iPhone. feels like I'm paying for a logo and a personal ticket to live in Apple's insular universe.

  14. They will have cut costs and have them be made in India, if they want to compete in a saturated market.

  15. China doesnt need Apple anymore. Apple handed them their technology already in exchange for cheap manufacturing. Idiots.

  16. I am wondering when will Apple be able to recognize the reality and stop using all kinds of excuses to cover this embarassment, which is their products are no longer the first class in the market.

  17. Really Tim Cook is just using China as a smoke screen to cover up the failing business model that was developed back in the infancy of cell phones. Apple can't compete as they did 5 years ago when a new contract got you a new phone for free. The higher and higher priced phones are going to sell far fewer in numbers. Especially now that contracts won't pay for the phones and stores want you to finance the full retail price.

    Cell phone hardware is far beyond app requirements and with the iPhone 5s/6 upgrading to 64-bit processors hardware is really only limited on batteries which was significantly cheaper to have replaced for $40-70 for most phones. So upgrades aren't attractive at $1000+. The Android marketplace has grown compete more with the app store. Apple has to bring prices back down to the $600 and under category to compete with Android phones with similar specs and stop losing market share.

  18. IPhone turn into a rotten apple, consumers now have more quality choice and iPhone is overrated and over priced.

  19. Why buy iPhone, when you can buy Huawei that costs less than 30% the price of an iPhone ? Why buy American when we can buy China made, designed and owned ? Tell me one thing that iPhone can do that our Huawei cannot ? I don't think you can so why buy iPhone ? Buy China and Huawei !

  20. OEM need to slow down their phone release cycle once every 2 years. Release a phone with REAL new features with reasonable prize, if not the same. Then sure.

  21. Chinese phone market share is rising while Samsung and Apple is falling. Numbers of Huawei, Oppo, OnePlus, Xiaomi etc are up some in double digits year on year. Is it the Chinese economy slowing? Why does CNBC not mention the slowing US economy? What? Not slowing?

  22. Is it just me that finds the concept of 'brand loyalty' as absolutely stupid?

  23. That's the reason why America banned Huawei's in order to reduce competition in sales and encourage other nations to do the same.

  24. Not really a American company if there worried more about China taking a hit. Just my opinion though

  25. Chinese stock market doesn't really matter. American stock market is a huge part of the US economy.

  26. What goes around comes around… Bloody USA.. Bloodsuckers…. Hate from India

  27. Apple arrogance and zero innovation plus cannot even catch up means that are Finnishedddd. No more paying more for less.

  28. Overpriced phones when competitors are pulling better tech at a better cost benefit.

  29. Chinese phones are simply better, they cost less, they are simply a much better value proposition. The only reason to buy Apple the last 3 years has been loyalty to an inferior product, not a sustainable business model.

  30. Mr. Tim Cook with all due respect plz don't blame China for your ignorance. Apple was top brand because of innovation at premium price but for past few years it is just becoming more premium (with every model price increase) and kind of no innovation when compared with competition from Koreans (Samsung) and Chinese (Huawei, Xiaomi, Vivo, etc) brands. You guys are charging really high premium with kind of no benefit.

  31. It's a shame that America calls itself a democracy and a world leader and doesn't want to let 1/5th of global population (chinese people) improve their living standards and become more modern

  32. Tim Cook trying to blame its downfall on Chinas economy, man every Chinese I know so far, they all possess the newest version of Iphone, many of them even have 2 or 3 phones just so that iphone could be the main phone, others as working or calling phone. I think the sales drop is ONLY due to competition, as all the listed companies are actually making very decent and sometimes fancy phones.

  33. Stealth nationalistic boycotting. Fair enough. The Chinese have watched since Trump came to office American news organisations celebrating the fall of the Chinese stock market. Brand America is in deep trouble.

  34. chinese have good taste, they are like we make this trash for the world to buy. we smart we use droid

  35. If apple lowers their products 20-30%. They might increases more consumer. Instead of uses China products.

  36. Not china economy slowdown.
    No apple price too high.

    The reality….
    The chinese think apple is not good anymore. Apple is not 'in' anymore.

  37. Not about trade war….
    But about how USA bully Huawei & the chinese think apple need to pay for huawei

  38. This Apple guy should be fired for criminal business practices. Apple should be bankrupt soon. Messing with China is a bad idea, Apple. China is the biggest country and economy in the world. American Plutocracy is destroying the country. In any other country this National Emergency would be called MARTIAL LAW. The President could put troops on the streets and make or change laws. If Trump does this, he will be your DICTATOR for life. We are in a crisis. We won't have elections anymore. The Republicans have been acting as though we will not be having free elections. Trump is the toilet paper forever stuck to America's shoe. Trump is the epitome of weakness!!! The economy is already in chaos because we have such a weak President. Trump didn't even know how to close an umbrella. Of course he didn't know what a government shutdown does.

  39. Brand royalty sucks.. buy the one that you need not what your ego desires..

  40. "iPhone sale slump in China means billions of dollars lost"

    They don't produce iPhones and put them in a warehouse. They produce on demand and an iPhone costs peanuts to produce compared to its selling price. Decline in sales means decline in projected revenue. Not money lost

  41. Nothing exciting come out from once magical company. Tim is not Job. It’s not about China. Its Tim Cook.

  42. report a lot of malarkey, some truths. Apple directly & indirectly hires many employees. IPhone is NOT favored, just too expensive!!

  43. It's obviously the tariffs, if you find your sales going down, that could be a sign that something sinister is going down, which we could not prevent because of the shut down.

  44. It eats the diseased dog in the world and the people of the world is slowly gnawing germs spreading disease to all products produced in China. mouse race

  45. American economy or industries doing badly, let's blame it on China. Politics going South, let's blame it on Russia. Typical American behavior. Please stop and think what went wrong instead of blaming other countries for your own failure.

  46. If the Chinese arent buying phones and cause the slump in the sales of iPhones.
    Then why phones from Huawei, Xioami, Oppo, One Plus , Vivo keep increasing in China and all over the world ?

  47. Hey Cramer America has banded Huawei, but we expect Apple to be accepted by Chinese customers?

  48. its not china.its your over price phone making people loose interest on you.it just cannot justify why your phones are soo rediculously expensive.

  49. Of course iPhones aren't selling so much in China. Stupid American tech companies put all their factories in China. That makes it easier for Chinese companies to reverse engineer and copy them. Foreign companies have little chance of winning any copyright lawsuit against a native company in China. Chinese courts always favor the home brands.

  50. Just heard from my Chinese guests, HuaWei phones running out of stock in China due to increased demand in many places. Buyers are having to pay deposits to book for the HuaWei phones from vendors. Apple phones are readily available and sales are very weak. Wow!!!!!

  51. China Contagion will spread across the world in 2019.
    Sell stocks before collapse. You have all been warned. ☠️

  52. Over priced junk.only change size here and there, copy other cell phone manufacturers ideas, Garbage camera…. Customers are not stupid

  53. yandex as a boswer instead of google and xiaomi or hawei instead of apple!👆

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