Apple (AAPL) stock took a hit on Tuesday, falling roughly 1.9%, after TF International Securities analyst Ming-Chi Kuo released a report saying iPhone shipments will decline as much as 15% year-over-year in 2024. Apple is set to announce its first quarter earnings results after the bell on Thursday.
According to Kuo, who has accurately predicted Apple’s moves in the past, a drop in iPhone sales in China coupled with the emergence of generative AI-powered and foldable smartphones will put pressure on iPhone sales throughout the year.
“Apple’s weekly shipments in China have declined by 30%–40% [year-over-year] in recent weeks, and this downward trend is expected to continue,” Kuo wrote in a post on Medium.
“The main reason for the decline is the return of Huawei and the fact that foldable phones have gradually become the first choice for high-end users in the Chinese market.”
Barclays, Piper Sandler, and Redburn Atlantic downgraded Apple’s stock in early January on concerns over iPhone sales in China. Bank of America, however, upgraded Apple’s stock, citing its Vision Pro headset and generative AI as future growth catalysts.
The downward trend has also cost Apple its spot as the richest publicly traded company by market capitalization. The company is now valued at $2.9 trillion, lower than the new top dog Microsoft, which had a market cap of $3.05 trillion as of Tuesday afternoon.
Apple is in the midst of some of its biggest changes yet, as the company prepares to make significant revisions to its App Store policies in Europe to comply with the European Union’s Digital Markets Act. The iPhone maker says it will begin to open up European consumers’ devices to third-party app stores and allow game streaming services like Microsoft’s Xbox Cloud Gaming on devices.
But critics including Epic CEO Tim Sweeney and Spotify CEO Daniel Ek say the changes don’t go far enough in satisfying their respective antitrust concerns.
The Department of Justice is also reportedly considering whether it should file an antitrust lawsuit against Apple related to its App Store practices, according to Bloomberg.
All of this comes as Apple prepares to launch the Vision Pro. An AR/VR headset that Apple refers to as a spatial computer, the Vision Pro is the company’s first new product category since it debuted the Apple Watch nearly a decade ago.
The Vision Pro goes on sale Feb. 2.
Daniel Howley is the tech editor at Yahoo Finance. He’s been covering the tech industry since 2011. You can follow him on Twitter @DanielHowley.
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