Please ensure Javascript is enabled for purposes of website accessibility

Why Apple Is Losing Profits in China

By Kevin Chen - Apr 23, 2013 at 2:45PM

You’re reading a free article with opinions that may differ from The Motley Fool’s Premium Investing Services. Become a Motley Fool member today to get instant access to our top analyst recommendations, in-depth research, investing resources, and more. Learn More

Hackers KuaiYong launch pirate iOS store.

Say goodbye to Apple's (AAPL 0.11%) software profits in China.

Recently, Chinese hacker group KuaiYong launched a pirated iOS App Store, letting anyone and everyone in China download Apple apps for free. KuaiYong also implemented geolocation techniques to make sure only those in China can access the website -- thus preventing any interference from the Cupertino company.

While you may think the innovative giant may have a few tricks up its sleeves, don't count on it. For a while now, American tech giants have realized the odds are against them. Back in 2011, Microsoft (MSFT 1.12%) CEO Steve Ballmer noted that Chinese revenue would only be 5% of its U.S. sales. He said that with good reason: A study conducted around that time found that the illegal market for software goods was three times that of the legal software market.

In the video below, Fool contributor Kevin Chen further outlines why China spells doom for Apple's software sales. Still, he thinks that there's reason to be bullish about Apple's future, thanks to prospects of a China Mobile (CHL) deal. To learn more about Apple's prospects, watch the video below.

Invest Smarter with The Motley Fool

Join Over 1 Million Premium Members Receiving…

  • New Stock Picks Each Month
  • Detailed Analysis of Companies
  • Model Portfolios
  • Live Streaming During Market Hours
  • And Much More
Get Started Now

Stocks Mentioned

Apple Inc. Stock Quote
Apple Inc.
AAPL
$140.52 (0.11%) $0.16
China Mobile Limited Stock Quote
China Mobile Limited
CHL
Microsoft Corporation Stock Quote
Microsoft Corporation
MSFT
$262.52 (1.12%) $2.90

*Average returns of all recommendations since inception. Cost basis and return based on previous market day close.

Related Articles

Motley Fool Returns

Motley Fool Stock Advisor

Market-beating stocks from our award-winning service.

Stock Advisor Returns
322%
 
S&P 500 Returns
116%

Calculated by average return of all stock recommendations since inception of the Stock Advisor service in February of 2002. Returns as of 05/25/2022.

Discounted offers are only available to new members. Stock Advisor list price is $199 per year.

Premium Investing Services

Invest better with The Motley Fool. Get stock recommendations, portfolio guidance, and more from The Motley Fool's premium services.