Apple, Inc. (NASDAQ:AAPL) is facing multiple headwinds, and chief among them are the weakness in China and slowing iPhone sales, said Bloomberg’s columnist Mark Gurman on Sunday.
China Woes Abound: While iPhone sluggishness will negatively impact China sales, the tech giant is facing other headwinds in the world’s second largest economy as well, said Gurman in the latest installment of his weekly “Power On” newsletter. The company is stymied by China’s ban on foreign brands in government workplaces and a shift in consumer preference to homegrown technology, he added.
After a 13% drop in China sales in the December quarter, Apple is bracing for another drop in the first quarter, which it is scheduled to report on May 2, the columnist said.
While Chinese consumers are not switching phones en masse, the main issues in China center on bringing new users to the Apple product ecosystem and getting existing users to upgrade sooner, he said.
Why iPhone Is Losing Appeal: According to Gurman, the reasons for the slowdown in the pace of iPhone upgrades are:
- Lack of old-school carrier subsidies
- Rising iPhone prices
- Shaky economic fundamentals
- Tentative recovery seen after the COVID-19 pandemic
Another major reason is that the company is giving consumers less reason to upgrade, the Apple specialist said. The product hasn’t changed significantly since the 2020 iPhone 12 launch, he said, adding that “[the] days of ...
