Analyst Wamsi Mohan from BofA Securities has raised concerns about Huawei’s potential impact on Apple’s presence in the Chinese market. While Apple has enjoyed smartphone market share growth in China at the expense of Huawei, thanks to U.S. sanctions, there is a possibility that Huawei’s new Mate 60 and Mate 60 Pro phones, equipped with their own in-house chip exhibiting 5G-level speeds, could reverse this trend.
Mohan explains that if Huawei can supply and scale its home-grown Kirin 9000S chip successfully, their Mate-series phones could potentially increase shipments and regain their market share, posing a threat to iPhone sales in the Asia Pacific region. It’s worth noting that historically, Huawei has been popular among Chinese consumers.
According to Mohan’s analysis, for every million iPhones sold, Apple earns just a little over 1 cent per share. If Huawei were to claim back 10 million units of market share, it would have approximately an 11-cent-per-share impact on Apple’s fiscal 2024 earnings. If we go further and consider the possibility of Apple losing the 30 million units it gained since the sanctions began, the impact could be far greater at $0.34 per share.
Despite expressing concern about the potential risk to Apple’s market share in China, Mohan maintains a neutral rating and a $210 price objective for Apple’s shares.
In addition to these developments, it’s important to highlight that Apple itself is set to launch its new iPhone 15 family of devices at an upcoming event on September 12.