Today we were hit with staggering positive news from Apple's supply chain that Apple is asking suppliers to manufacture between 85 million and 90 million units combined of two new iPhone models with 4.7-inch and 5.5-inch displays by Dec. 31. That's quite the leap from last year in what is only an update to the current iPhone 6. But the day is ending with a prophet (or profit) of doom saying that Apple could be in store for a rocky ride in China.
With all of the drama in Greece lately, Jim Cramer has become used to assessing how the disturbing issues in Europe could impact company earnings in the U.S. But what about China?
In a CNBC report, they quote the "Mad Money" host as saying that "If you have a gigantic decline in the Chinese averages and their consumers get burned…you have to assume there will be real damage to China's economy." But the far more significant impact Cramer is worried about is the slowdown of Chinese consumption of American-made products.
Cramer added that the "biggest potential Chinese victim—Apple." China represented $16 billion worth of equipment sales for Apple in the first quarter, which was up an amazing 70 percent year over year. Tim Cook also recently conveyed on the company conference call that the Chinese middle class loves Apple products, and he expects iPhone sales in China to surpass U.S. sales this year.
Cramer further added that "Until the Chinese market bottoms or rebounds, I think that these stocks [Apple, McDonalds, Starbucks, Caterpillar and GM] will all be guilty until proven innocent and they will be subject to the kind of swings that many of you can't handle." For more on this read the full CNBC report. Apple's stock AAPL was down 2.48% today.
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