Apple Reduces Revenue Forecast Due to Coronavirus Impact
With the novel Coronavirus spreading through the world, the tech industry has seen a huge impact as well. Since China is the country with the highest number of confirmed COVID-19 cases, supply chain and manufacturing for most major technology companies have been affected. Even MWC 2020, the biggest smartphone event of the year was cancelled due to Coronavirus fears.
Now, Apple has released an investor update informing stakeholders that the Cupertino giant is reducing its sales forecast for the year due to the impact of Coronavirus. Due to this, the company does not expect to meet its revenue guidance for Q2 2020.
In its update, the company said that while its “quarterly guidance issued on January 28, 2020 reflected the best information available at the time”, the company is “experiencing a slower return to normal conditions than [it] had anticipated. As a result, [Apple does] not expect to meet the revenue guidance [it] provided for the March quarter.”
The company highlighted two main reasons behind it cutting its revenue guidance for the second quarter of the year. The first being the constrained iPhone manufacturing due to conditions in China — while most of Apple’s partner manufacturers have restarted work, production is ramping up at a slower pace than anticipated.
Second, Apple says that the demand for its products in China has reduced. The company said, “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.”