Home News Apple Faces Potential Import Ban on Certain Apple Watch Models

Apple Faces Potential Import Ban on Certain Apple Watch Models

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Apple has been experiencing a challenging period, grappling with concerns over the demand for its new iPhone. Unfortunately, the tech giant now faces another obstacle as news emerges of a potential import ban on specific models of its Apple Watch.

The U.S. International Trade Commission recently ruled that Apple (AAPL) has violated patents held by medical-technology company Masimo (MASI) related to measuring blood-oxygen levels. Consequently, the commission has issued a limited exclusion order, prohibiting the import of certain Apple Watches into the U.S.

While this may not be a significant setback for Apple, it adds to the headaches the company is already facing. The sales of Wearables, Homes, and Accessories products—including the Apple Watch—amounted to $8.28 billion in the company’s most recent quarter. However, with criticisms piling up regarding the lack of innovation in its latest iPhone model, this is an unwelcome development for Apple.

In response to this ruling, Apple has several options to consider. The company can make changes to its smartwatches, negotiate a settlement with Masimo, or attempt to challenge the decision through an appeal. Additionally, there is a possibility that the Biden administration may overrule the commission’s decision within the next 60 days.

Apple has confirmed its intention to appeal the ruling, asserting that it will not immediately impact sales of its smartwatches (according to The Wall Street Journal). However, the company has not provided any further comment at this time.

Following this news, shares of Masimo saw a 10% increase in premarket trading, while Apple’s stock experienced a modest 0.2% rise to $167.20. Over the past three months, Apple shares have declined by 15% leading up to Thursday’s close.

Looking ahead, all eyes will be on Apple’s September-quarter earnings report, particularly in relation to iPhone sales. Analysts at J.P. Morgan have already highlighted signs of weaker demand for the iPhone 15 compared to its predecessor at the same time last year.

According to the FactSet consensus, Apple is expected to report quarterly sales of $84.67 billion, down from $90.60 billion in the previous year’s corresponding period. Furthermore, iPhone sales are anticipated to decrease to $41.53 billion from $42.84 billion.

In conclusion, Apple’s journey ahead is marked with challenges, both concerning the potential import ban on certain Apple Watch models and the declining demand for its latest iPhone. The company’s response and the outcome of future developments will determine its path forward in the coming months.

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