Coronavirus is hurting Apple's quarterly revenue

Joanna Estrada
February 18, 2020

"The situation is evolving, and we will provide more information during our next earnings call in April", the company said.

Apple says the viral outbreak in China has cut production of iPhones.

The second factor for Apple's revenue-shortfall warning for the March 2020 quarter is that that demand for Apple products in China has declined after all of its retail stores in China (and many of its partners) were closed because of the health crisis. The spread of coronavirus has caused the company to temporarily halt production and close retail stores in China. China is Apple's third largest retail market for iPhones, after the United States and Europe. In January 2019, Apple was forced to slash revenue guidance for its fiscal first quarter of 2019 due to weak iPhone sales in China. As China's return to work has proved halting, and the coronavirus itself more intractable than some anticipated, the company's change in guidance is nearly unsurprising.

Apple, which forecast record revenues of up to $67bn in the current quarter, did not put a number on the likely hit. At the time, the company said it provided a wider range of guidance than usual because of uncertainty related to coronavirus.

"All of our stores in China and many of our partner stores have been closed", it added. A few weeks ago when announcing its holiday sales, Apple told Wall Street analysts that revenue for the quarter ending this March would range between $63 billion and $67 billion. Additionally, stores that are open have been operating at reduced hours and with very low customer traffic.

Regardless, after Singapore cut its economic growth forecast and Apple is part of that mix, the chance of the coronavirus having a modest impact on the global economy is fading. The auto industry is another sector that has been affected by disruption to its supply chain.

Other reports by Click Lancashire

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