Political winds loom large over Apple’s business in the country controlled by the Chinese Communist Party whether its CEO Tim Cook wants to acknowledge it or not.
Dave Lee for Bloomberg Opinion:
the iPhone — the main driver of Apple’s revenue — was doing just fine. “In the September quarter, we set an iPhone revenue record in China, and we’re very proud of that,” Cook said. “Over the long term, I view China as an incredibly important market, and I’m very optimistic about it.”
The positive spin did the trick, but it’s clear the company is heading into an uncertain period in regard to China, which accounts for around 19% of its overall revenue. Sentiment around the Cupertino giant and its products is becoming much harder to predict in the face of political volatility between the US and China, where tensions center squarely on the availability and manufacturing of cutting-edge technology.
This year and next might present a bigger challenge than previous ones based on what happens on a geopolitical level. We’re still in the early days of US efforts to get tough on China’s access to new technology. As I’ve written before, there is worry that political change might happen more quickly than the supply chain can handle. Efforts to diversify production away from China are happening, but only slowly…
It’s hard to get a read on what Apple is seeing in the current quarter. It warned, without going into geographical specifics, that year-on-year revenue growth would be flat in the October-December period, its fiscal first quarter.
MacDailyNews Take: We covered this over a year ago here: Tim Cook firmly latched Apple onto China’s CCP teat. What’s his plan for weaning it off? – November 2, 2022
And, btw:
Similar (“flat”) revenue in a 13-week quarter (2023) vs. a 14-week quarter (2022) equals growth.
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Don’t worry, expert liar Joe Biden has it all under control.
Especially after his brother’s wife’s ex-husband’s daughter step-mom’s brother cashes that next check from the CCP
If Joe is an expert liar, that obviously makes Donny a master. A recent WSJ article said that whilst in office Donny told 30,000 lies…
Link the WSJ article, please. That comes out to about 28 lies per day, NO WAY!
Their is a HUGE difference between knowingly lying (Hillary, Biden) and exageration or mistatement of facts. Biden knowingly lies DAILY and his press secretary stares into the faces of the press and knowingly lies to their face DAILY. But let me get this straight, it only bothers you when Trump lies, correct?…
Everything about Trump bothers me…..
Apologies was a Washington post article
https://www.washingtonpost.com/politics/2021/01/24/trumps-false-or-misleading-claims-total-30573-over-four-years/
Well Hugo, BOTH bother me…
Got it backwards and sideways…much like the media and Administrative State (Dem Party) for the last 7 yrs, but “we are concerned for you/the Country per mis-info”. https://x.com/NRO/status/1721244980855927029?s=20
Did the article say how many lies Dementia Joe has mumbled in his 3 years?
If the Washington Post published such an article, would you actually believe it?
WashPost will NEVER do that. You have a Democrat dominated newspaper in a Democrat city and a woke leader.
But we do see WP covering up for Biden’s lies DAILY. We do see them EXCUSING Biden lies DAILY. We do see them totally IGNORING and nor reporting Biden lies DAILY.
Did I miss anything?…
Assume Cook believes Apple is IMMUNE. He famously kowttows to every China Censorship demand and NEVER utters a critical word against the repressive regime guilty of slave labor and human rights abuses. But if the relationship changes drastically, guessing he will be blindsided with no immediate backup plan…
Apple has to abide by the rules of all the counties where it sells its products. China is no exception. [For example, Apple is now required to use USB-C to charge its devices sold in the EU.]
Apple investigates all human rights violations by all of its suppliers… and has dropped suppliers that continued to ignore those violations. This is much more effective than just “speaking out” about them.
Yes, Apple abides by Communist CONTROL and CENSORSHIP RULES and says nothing about human rights violations and slave labor encampments…
There is no immediate backup plan (by any company) that can counter China. Period. The Chinese Communist Party began moving mountains (literally) to position China as THE global manufacturing and assembly powerhouse when Tim was only 15 years old and Apple hadn’t even sold its first Apple 1 in ’76. The plan is for Apple to keep its mouth shut and continue quietly diversifying its production chain away from China. Vietnam? India? It is going to take decades for them to catch up and displace China. The States? That ain’t gonna happen. There is no immediate backup plan.
There doesn’t have to be an immediate plan. Apple is shifting to India. So it has it’s headquarters in the USA, distributed engineering all over the world, and its manufacturing in two of the highest growth, lowest cost manufacturing centers.
If your religion is capitalism, what’s the problem?
Seems to me that the self-proclaimed capitalists on this forum are more interested in politics than pragmatic business.
The states can do it BETTER than China. Were it all BEGAN and no reason not to do it again. Unless you’re high on Apple Apologist talking points. Apple only bolted to China under Cook’s supervision after NAFTA was passed for obscene profits as a result of cheap (slave) labor, lack of labor laws and union protections.
Now one point you are correct on, the China model will never work in the USA and that’s a damn good thing.
We value workers with better wages and benefits, legal protections, labor laws and more. Something you will not find in China and most developed nations.
To the naysayers products would cost more, so ending slave labor and building up a Communist economy and military (potential U.S. threat) to save a few bucks is obviously more important to you…
Have to agree with your points. Now would Apple still be able to keep prices even close to what they sell at now if manufacturing was brought back to the States? With higher prices, there may be less product sold. To control stale inventory growth, number of items manufactured will be lower. Manufacturing costs will rise per unit as economies of scale drop away, possibly accelerating future price increases in a viscious circle. I imagine Apple could keep some of that at bay should they decide to reduce their profit margin, but that IMO is highly unlikely. I’d hate to see Apple’s products become the ‘Betamax’ of this generation.
With the local tax incentives and guessing no union workforce in the USA not clear where prices will be. However, made in America will RESONATE VOLUMES with American customers not yet in the Apple fold — particularly in the heartland, mountain states, down South, Texas and the Southwest. So, the gain in market share possibly could offset the higher manufacturing costs certainly to a degree. On the flip side, we don’t know the effect of higher prices to existing customers, but returing to the USA would pay dividends in many unforseen ways. Simply, its the right thing to do freeing Apple from a potential VOLATILE Chinese Communist state. That all said, at the end of the day, we all know how Big Money influences EVERYTHING…
Cook needs to be replaced. They must get a visionary who knows the difference between a transistor and a “sister”.