This article is based on an article from the Japanese edition of Engadget and was created using the translation tool Deepl.
U.S. President Trump recently issued an executive order banning all U.S. transactions with Tencent, the Chinese company that runs the messenger app WeChat.
If this forces WeChat to be removed from the App Stores around the world, global iPhone shipments could drop by up to 30%, according to analyst estimates.
Analyst Ming-Chi Kuo, known for his insider information on Apple, stated his predictions in both optimistic and pessimistic scenarios, ranging from "WeChat app removed from only the US App Store" to "removed from the App Stores worldwide".
The WeChat app is extremely popular with Chinese mobile device users, with both iOS and Android versions available, effectively making it the "third platform" (from cashless payments to social networking). According to MacRumors, there are over 1.2 billion monthly active users worldwide.
Such a global ban on the App Store for the WeChat app (worst-case scenario) would have devastating results, according to Kuo. He estimated that "the move will tank iPhone shipments in the Chinese market," and estimated that global iPhone shipments would drop 25-30%, and global shipments of other Apple hardware products such as AirPods, iPads, Apple Watches, and Macs would drop 15-25%.
On the other hand, under the optimistic scenario of removal from only the U.S. App Store, global iPhone shipments would be impacted by 3-6% and other Apple products would be affected by less than 3%, according to the report. MacRumors initially said it was unclear whether the expected decline in the worst-case scenario was only for the global or Chinese market, but Kuo contacted them to say he was referring to worldwide shipments.
In Apple's third-quarter earnings release, Greater China accounted for more than 15 percent of total revenue. But if Kuo is right about the impact, the WeChat economic sphere may be more expansive than that.
Kuo has recommended that investors reduce their holdings of Apple's supply chain-related shares because of the risk of a WeChat ban. However, the presidential order in question doesn't go into effect until September 20, and with more than a month to go, it's likely that CEO Tim Cook and others will make some kind of push to President Trump.
This article is based on an article from the Japanese edition of Engadget and was created using the translation tool Deepl. The Japanese edition of Engadget does not guarantee the accuracy or reliability of this article.