Apple shares have been reeling this week after disappointing earnings results. (Matthias Schrader / Associated Press)
April 28, 2016
Billionaire business magnate Carl Icahn, whose investment decisions can influence the stock market, said Thursday that he dumped what was left of his nearly 1% stake in Apple Inc. on fears that Chinese authorities would bully the iPhone maker.
Shares of Apple sunk after his announcement in a live interview on CNBC. The shares have lost 9% of their value since Apple revealed Tuesday troubling first-quarter financial results, including a 26% sales drop in Greater China compared with the same period last year.
“China obviously could be a shadow for it, and we have to look at that,” Icahn said of Apple.
Chinese consumers once infatuated with the iPhone as a status symbol of new wealth have increasingly turned to more affordable smartphone alternatives. And regulators in China recently took aggressive action against Apple, blocking access to the company’s online stores for digital books and movies. It’s unclear when access might be restored.
Financial analysts say it’s too early to worry about the falling sales in Apple’s largest market after U.S. Apple executives said Tuesday that they remained committed to China and that its economy is steadier than many believe. The company also manufacturers in China.
But the capricious nature of China’s government was too much for Icahn to stomach, especially after an unexpected tumble in oil prices ravaged his energy industry bets last year.
“I worry a little bit that a tsunami could hit it,” he told CNBC.
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