“Chances are, you’ve been hearing an awful lot about China lately. The Middle Kingdom’s broader macroeconomic slowdown has been weighing on markets recently, particularly this last week,” Evan Niu writes for The Motley Fool.
“China’s economy is indeed slowing, and it has now devalued the yuan to stimulate exports while also cutting interest rates to spur economic activity. Chances are, you’ve also heard about all of this as it relates to Apple’s business, since China is the Mac maker’s second-largest, fastest-growing market,” Niu writes. “To be clear, China’s deceleration may very well have some impact on Apple. I mean, how could it not? But investors seem to be overweighting this concern, when they should really delink the current emotional sentiment from the reality of just how strong Apple’s business is in China is. Apple’s business in China is far more resilient and much less vulnerable to macroeconomic conditions than you may think.”
Niu writes, “Here’s the only real question that actually matters: Does the ongoing macroeconomic slowdown pose a meaningful threat to the longer-term trend of China’s booming middle class? This is the key to Apple’s future in China — and the answer is no.”
Read more in the full article here.
MacDailyNews Take: Appel CEO Tim Cook has repeated said that Apple continues to do well in China and that there’s no significant evidence of China’s economy impacting Apple’s sales in the country.
Only American Wall Street will hurt APPLE!
But, but, but!
I wanna buy in Apple so let’s pretend anything to bring down the stock so I can buy in!
Drunk on the Kool Aid again, MDN? Nobody, including Tim Cook, knows what the consumer electronics market will look like during the next year, or whatever passes for “long term” these days. Apple’s sales in the last 6 months do not predict what they will be in the next.
If we actually look long term on a 20+ year timeline, China’s dreams of being a middle-class paradise are folly. There is not enough raw material on the planet to support the transition of poor Chinese people into middle-class American lifestyles. Apple will never fill every Chinese household with multiple Macs and iOS gadgets. Like every other American media middleman, Apple’s dreams of streaming media to every Chinese home will fall flat under communist throttling and unchecked consumer piracy.
Like it or not, the turbulence in the Chinese marketplace will have unpredictable effects on all American companies that do business there, and the long term growth prospects are long overdue for a realistic correction. Apple can’t sidestep reality.
China is not 325 millions people. It is 5 time larger. A small middle class china will do pretty well consuming Apple products.
Scale is often put aside. It is a big mistake. It does well for manipulator but the reality is far more accurate when you can see signup almost in realtime. I trust Cook on that! LOL!
“MacDailyNews Take: Appel…” Oops again 🙂
Well, here’s the opposite opinion that makes a good point based on currency valuation and how A-P-P-L-E pays for components and gets paid for it’s phones in China:http://www.vox.com/2015/8/26/9210631/china-stock-market-crash-apple