Apple Inc. (NASDAQ: AAPL) doesn’t expect to meet its second quarter revenue guidance due to work slowdowns and lower iPhone supply globally due to the outbreak of the novel coronavirus in China. The tech giant that designs, develops and sells consumer electronics initially outlined that it expected to report net sales of between $63 billion and $67 billion for the quarter, with CEO Tim Cook citing uncertainty regarding coronavirus as the reason for the unusually wide $4 billion range.
Apple Inc. (NASDAQ: APPL) won’t meet its revenue guidance of $63 billion to $67 billion for the March quarter, citing manufacturing slowdowns, lower iPhone supply globally and Chinese store shutdowns as the primary reasons. (Credit: CNBC).
Apple outsources the manufacturing of many of its products, including the iPhone, to Taiwanese group Foxconn. The majority of Foxconn’s factories are located throughout China, which was at the center of the coronavirus outbreak. Consequently, there was a temporary halt to production and the closure of a number of retail stores. Apple commented that it is:
experiencing a slower return to normal conditions than we anticipated”
and expects supply shortages of the iPhone globally.
This represents the second time in only 13 months that Apple has cut its financial guidance due to concerns in China. In January 2019, Apple downgraded its revenue guidance for the first fiscal quarter of the year due to weak iPhone sales in China. However, the company expects the disruptions to only be temporary. Generally, iPhone sales have been surging, up 8% in the last three months of 2019.
Apple is currently trading for a tick under $325 per share and have rallied over 90% in the past year.
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