Apple warned Monday it was unlikely to achieve its March quarter sales steering set just three weeks ago because the world’s most valuable technology agency became one of the largest company casualties of China’s coronavirus pandemic.
The rapidly spreading virus has killed almost 1,900 in China and stricken some 72,000 people, confining millions to their properties, disrupting supply chains, and delaying resuming of production operations after the extended Lunar New Year holidays.
Manufacturing plants in China that produce Apple’s iPhone and other electronics have begun to reopen; however, they’re improving slowly than anticipated, Apple stated. That will imply fewer iPhones available in the market worldwide, making Apple one of the largest Western corporations to be harmed by the epidemic.
A few of its retail stores in the nation remain shut or are working at reduced hours, which will damage sales this quarter.
China accounted for 15% of Apple’s income, or $13.6 billion, last quarter, and provided 18% of revenue in the year-ago quarter.
In late January, Apple had estimated $63 billion to $67 billion in income for the quarter ending in March, which it stated was wider than the normal range as a result of the uncertainty developed by the coronavirus. It didn’t offer a new income estimation nor present a profit forecast Monday.
Apple, value $1.4 trillion by market capitalization, may face a hot market response Tuesday when Wall Street resumes after the Presidents Day holiday, analysts mentioned.
Shares of its Asian suppliers plunged on the news, with Samsung Electronics plunging 2.4%, Taiwan Semiconductor Manufacturing down 1.8%, and SK Hynix losing 3.3%.
Analysts have calculated that the virus may halve demand for smartphones in Q1 n China, the world’s largest marketplace for the devices.