Apple Says Will Not Meet Revenue Guidance for March Quarter Due to Coronavirus Impact

By Reuters
February 17, 2020COVID-19
Apple Says Will Not Meet Revenue Guidance for March Quarter Due to Coronavirus Impact
Customers walk past an Apple logo inside of an Apple store at Grand Central Station in New York, on Aug. 1, 2018. (Lucas Jackson/File Photo/Reuters)

Apple Inc. said on Monday it will not meet its revenue guidance for the March quarter due to the coronavirus outbreak slowing production and weakening demand in China.

Apple’s manufacturing facilities in China have begun to re-open, but they are ramping up more slowly than expected, the technology company said in a statement to its investors.

Global supplies of Apple’s iPhones will be limited as the sites work toward operating at full capacity, the company said.

“These iPhone supply shortages will temporarily affect revenues worldwide,” the company said.

In January, Apple forecast $63 billion to $67 billion in revenue for the quarter ending in March, ahead of estimates of $62.4 billion.

The company said it will provide more information during its next earnings call in April.

It also said that store restrictions due to coronavirus precautions have affected its sales in China, with most retail stores either closed or operating at reduced hours.

“We are gradually reopening our retail stores and will continue to do so as steadily and safely as we can,” the company said.

The disruptions follow a strong December quarter for iPhone sales, which were up for the first time in a year.

The outbreak is expected to pile pressure on China’s economy with multiple companies struggling to restart production after an extended Chinese New Year holiday.

Fiat Chrysler, Hyundai and General Motors have also said their auto production lines were, or could be, hit by Chinese factories that are slow to restart due to the virus.

Analysts have estimated that the virus may slash demand for smartphones by half in the first quarter in China, the world’s biggest market for smartphones.

By Neha Malara and Laila Kearney

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