Apple has shut down their online store in Russia in the face of falling currency prices. It seems strange to shut down sales just before Christmas, but Apple’s earnings have been at risk of falling significantly when turned back to U.S. dollars. Apple does not have physical stores in Russia, so it relies on its website and third-party sellers. When someone tries to purchase a product, such as the iPad 2 or iPhone 6, on the website now, they are greeted with a message saying, “We’ll be back. We’re busy updating the Apple Store for you and will be back soon.”
Russia’s currency, the ruble, has dropped off a cliff, losing more than half its value against the dollar this year. The drop has been caused by falling oil prices and sanctions from the west for their support of Ukrainian separatists. The ruble has fallen more than 20% this week, even after the central bank raised interest rates to 17% from 10.5% in an attempt to stop the decline. Oil is the county’s main export, and there are concerns that the U.S. will implement a new wave of sanctions, meaning things could get worse.
The falling ruble is a major headache for Russian consumers, as prices are rising up to 20% for a variety of products. Apple raised the price of the iPhone 6 and iPhone 6 Plus 25% on November 26th, but the value of sales in terms of dollars still fell more than $250. The financial panic hurting Russia won’t have a major impact on its overall earnings, but it does hurt prospects in a fast-growing market. Apple had sold 1.57 million iPhones in Russia in 2013, double what it had in 2012..