Apple said they are expecting their quarterly revenues to be hit adversely owing to the coronavirus outbreak in China. The company told investors they are expecting a dip in revenue from the earlier projected $63 – $67 billion but isn’t giving a new estimate just yet.
Apple said they are having to deal with the dual scenarios of factories being shut in China while demand for its iPhones to have waned in that country off late due to the healthcare emergency scenario prevailing in China. Apple explained that also is the reason they are projecting a wider than usual revenue target with scope to adjust for $4 billion which is unusual in its history.
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Meanwhile, the local Chinese government was forced to shut factories and prevented its citizens to come out of their homes. Not only did this adversely affect iPhone production, customers out to buy a new iPhone are seriously lacking too. Stores were largely shut or there aren’t many buyers in the limited locations where businesses were still operating.
Apple though is seeing a glimmer of hope given that factories outside of the Hubei province in China – the epicentre of the outbreak – are slowly coming out of the slumber through achieving optimum production levels is going to take time. Working hours too have been kept restricted for now.
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In what can be considered a double whammy for the iPhone makers, demand for the smartphone too has taken a sharp dip as people simply aren’t buying new stuff at the moment. Stores are shut and open for only a limited period. Even if they are open, there aren’t many buyers either.
Apple gets the majority of its iPhones or its components made in China which is the reason revenue for the quarter are going to take a beating. This no doubt would be a real shock for the company given that its latest iPhone 11 series has been a huge success worldwide and sales have been the highest in years.
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Apple iPhone shipment likely to take a 10 percent hit owing to Coronavirus
Unofficial reports by Apple analysts Ming Chi Kuo had earlier predicted iPhone shipments could be down 10 percent owing to the health scare in China. That would mean about 36 – 40 million iPhone being shipped in Q1 of 2020 even though Apple does not disclose its quarterly iPhone shipment figures.
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