Coronavirus is hurting Apple’s quarterly revenue
Apple warns that the coronavirus outbreak will impact both production and demand for its products in China.
Apple Inc said on Monday that it will not meet its revenue guidance for the March quarter. The tech giant is blaming the coronavirus, saying the outbreak of the virus is affecting both production and demand in China.
The company said that despite the fact that its production facilities in China have reopened, they are ramping up slower than expected.
Apple had forecast $63bn to $67bn in revenue for the quarter ending in March, ahead of estimates of $62.4bn.
Apple said that supply for its iPhones will be “temporarily constrained” as manufacturing facilities in China are still not operating at full capacity. Sales of iPhones were up for the first time in a year in the December quarter.
The company also said that store disruptions had affected its sales in China, with most stores either closed or operating at reduced hours.
The outbreak is expected to pile pressure on China’s economy. Companies are struggling to restart production after an extended new year holiday. Supply chains from the car industry to smartphones remain disrupted.
Analysts have estimated that the virus may slash demand for smartphones by half in the first quarter in China, which is the world’s biggest market for smartphones.