Why Apple shares are unexpectedly falling this morning

So, you’d think that after just announcing record preorders for the iPhone 6, Apple’s shares would be surging to new highs, right? Actually, no — Apple shares are falling on Tuesday morning and the biggest reason why is that new reports out of China indicate that the world’s largest mobile carrier might not even launch theiPhone 6 this year.

Bloomberg brings us word that China Mobile “will focus on selling cheaper phones that don’t require subsidies as the world’s largest carrier said it doesn’t know when Apple’s iPhone 6 will be available in the nation.” The decision to push cheaper phones to customers comes as China Mobile is looking to cut $2 billion in subsidy costs it pays for high-end smartphones from Apple and Samsung.

Just how much more expensive is the iPhone in China compared to other 4G phones? According to Bloomberg, China Mobile is selling the iPhone 5s for 5,288 yuan with a contract, whereas a new 4G-capable phone from Huawei costs 1,199 yuan without a contract.

Given that China Mobile has nearly 800 million subscribers, news that the device might not launch on the carrier this year would obviously have a big impact on Apple’s holiday quarter iPhone sales. Because of this, Apple shares fell by more than 1.7% in pre-market trading and immediately dropped by 1.4% once trading officially started on Tuesday.

SOURCE:

BLOOMBERG