Daily US Times: Apple has warned that the coronavirus disruption affected production and sales of iPhone which means “worldwide iPhone supply will be temporarily constrained”.
The tech giant also acknowledged potential revenues falling. It is the first major US company to say that the epidemic will hit its finances.
Apple though did not reveal how much money they are going to lose, but the company forecast record revenues of up to $67bn in the current quarter.
In a statement, Apple said they do not expect to meet the revenue guidance we provided for the March quarter as it was “experiencing a slower return to normal conditions” than expected.
In the face of coronavirus disruption, most of the Apple stores in China either closed or operating at shorter hours. As a result sales of Apple products would be lower.
Apple’s iPhone manufacturing partner sites located outside of Hubei province. All these facilities have reopened, but Apple said they are ramping up more slowly than we had anticipated. Hubei is thought to be the epicenter of the virus outbreak.
The statement added: “All of our stores in China and many of our partner stores have been closed. Additionally, stores that are open have been operating at reduced hours and with very low customer traffic. We are gradually reopening our retail stores and will continue to do so as steadily and safely as we can.”
Analysts previously estimated that the virus may slash demand for smartphones by half in the first quarter in China, which is the biggest market for the devices. The car industry is another sector to face the hit. Giant car companies have been affected by disruption to its supply chain. Last week, JCB, a heavy equipment manufacturer said they are cutting production in the UK due to a shortage of supply from China.
New virus cases reported outside of Hubei have been declining, but it is still a big concern in the province. On Monday, there were 115 fresh cases outside Hubei announced which is a sharp down from nearly 450 a week ago.
Despite hopes that factories and shops are slowly getting back to normal situation, Apple’s warning will underline that China’s economy will be seriously affected by the coronavirus.
International Monetary Fund predicted that there could be a cut of about 0.1-0.2 percentage points to global growth, but stressed there was much uncertainty about the virus’s economic impact.
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