China is expanding its ban on Apple iPhones, initially affecting central government employees, now extending to state-owned companies and government-affiliated agencies.
Apple's share prices have dropped by nearly 6% in two days, resulting in a loss of approximately $200 billion in market value.
China accounts for roughly 19% of Apple's sales, making it a critical market for the company.
China claims to welcome foreign companies but is sending a retaliatory message following the U.S. restrictions on Huawei.
This move could hurt Apple's China sales by up to 5%, potentially creating opportunities for other smartphone manufacturers.
Huawei's new Mate 60 Pro phone, featuring a homemade chip, aims to benefit from the Apple sanctions and fill the potential gap in the market.
While concerns about privacy arise due to the iPhone ban on government employees, Apple's substantial size and investments in China give it some leverage.
Apple has invested $275 billion in China since 2016, creating more than 5 million jobs, potentially influencing the outcome of this situation.
Apple is already shifting its supply chains out of China, which could accelerate as a result of such bans.