Slowing China economy a risk for Apple
Apple (AAPL) is making big gains in China, but a slowing economy there could take a bite out of Apple’s momentum, UBS analyst Steven Milunovich said in a research report Thursday. Greater China has provided over half of Apple’s recent revenue growth at an above-average corporate profit margin, Milunovich said. He expects strong China results for the June quarter as well. Apple is set to report fiscal third-quarter results after the market close on July 21. UBS data indicate “Apple is penetrating China at multiple income bands, consumers are upgrading to more expensive phones, and Apple has the highest brand commitment level,” Milunovich said. UBS sales channel checks indicate somewhat counterintuitively that the low-end handset market is softer than the high end as consumers trade up, he said. A slowing Chinese economy, however, is a risk for Apple, Milunovich said. So far, there’s been limited impact from the stock market…