Kuo: Global iPhone Shipments Could Decline Up to 30% If Apple Forced to Remove WeChat From App Store [Updated x2]

In a worst-case scenario, Apple's annual global iPhone shipments could decline by 25–30% if it is forced to remove WeChat from its App Stores around the world, according to a new research note from analyst Ming-Chi Kuo viewed by MacRumors. The removal could occur due to a recent executive order aiming to ban U.S. transactions with WeChat and its parent company Tencent.


Kuo lays out optimistic and pessimistic scenarios depending on whether Apple is only required to remove WeChat from the App Store in the United States or if the ban would apply to the ‌App Store‌ in all countries.

WeChat is extremely popular with Chinese mobile device users, essentially operating as its own platform on top of iOS and Android for many users, but the app is also widely used around the world and has over 1.2 billion monthly active users. Kuo argues that a worldwide ban on WeChat in the ‌App Store‌ would be devastating as a result.

Since WeChat is very critical to Chinese users, integrating communications, payments, e-Commerce, social software, news reading, and productivity functions, we believe that the move will tank ‌iPhone‌ shipments in the Chinese market. We estimate that global ‌iPhone‌ shipments will decline by 25–30%. Global shipments of other Apple hardware products, including AirPods, iPad, Apple Watch, and Mac, will decline by 15–25%.

Under his optimistic scenario in which WeChat is only removed from the U.S. ‌App Store‌, Kuo predicts global ‌iPhone‌ shipments would be impacted by 3–6% with other Apple products being affected by less than 3%.

Apple does not break down its ‌iPhone‌ shipments by region, but overall, Greater China accounted for a little over 15% of Apple's total revenue during the June quarter, making it a significant part of Apple's business.

Kuo recommends that investors reduce their stock holdings of companies in Apple's supply chain such as LG Innotek and Genius Electronic Optical due to the risks of a WeChat ban. It does, however, remain to be seen what will happen as the prohibitions laid out in the executive order do not take effect until September 20. As a result, there is still time for the order to be clarified, modified, or rescinded.

Update 1: 10:36 p.m. This article originally stated that the 30% decline was in reference to Apple's total ‌iPhone‌ shipments, but the research note is not completely clear as to whether it refers to global or Chinese shipments. Given the Chinese share of Apple's overall sales, it seems more likely to be referring to Chinese shipments.

Update 2: 1:21 a.m. Kuo has informed MacRumors that the 30% decline is in reference to worldwide shipments and has issued an English version of his report that makes this clear.

Note: Due to the political or social nature of the discussion regarding this topic, the discussion thread is located in our Political News forum. All forum members and site visitors are welcome to read and follow the thread, but posting is limited to forum members with at least 100 posts.

Related Roundup: iPhone 12

Top Rated Comments

(View all)
Avatar
7 weeks ago
All that needs to happen is for people to make the right decisions on Nov 3rd so the nightmare will be over.
Score: 44 Votes (Like | Disagree)
Avatar
7 weeks ago
Another case of the Trump overstepping his office, He thinks he's president of the world.
Score: 30 Votes (Like | Disagree)
Avatar
7 weeks ago
Wechat is 100% of China. Apple could potentially lose all Chinese iPhone sales without WeChat. That 30% loss is worldwide.

Wechat is not just a messaging app. It is the de facto digital payment system. All personal transactions in China is done with WeChat. Chinese people will not be able to do business properly without WeChat.
Score: 20 Votes (Like | Disagree)
Avatar
7 weeks ago
I have tons of Chinese friends here in Sweden. All of them rely on WeChat, and would go to Android the second WeChat disappear.

Why would there be a worldwide ban though? Why the hell would Trump decide which I apps I can use in Sweden?
Score: 17 Votes (Like | Disagree)
Avatar
7 weeks ago
Ha if this happens, Apple will allow jailbreaking and let third party Chinese app stores run in iOS 13.7.
Score: 10 Votes (Like | Disagree)
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7 weeks ago
Worth noting, WeChat isn't some 'popular' platform in China. It's pretty much a compulsory app that the government uses to track people's movements/habits and monitor their conversations.

Not having it would severely inconvenience your movements/interactions in China because a lot of public infrastructure relies on it.

So... people wouldn't be dumping Apple by choice because they 'want' WeChat. Rather, their lives would become a lot more complicated.
Score: 9 Votes (Like | Disagree)

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