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Apple to Miss Quarterly Guidance & iPhone Sales Estimates to Fall Short Due to Coronavirus

Apple to Miss Quarterly Guidance & iPhone Sales Estimates to Fall Short Due to Coronavirus

Apple today announced an update to its financial guidance for the March quarter, revealing that the firm will not meet its previously announced revenue goals due to the impact of the Wuhan Coronavirus outbreak.

Our quarterly guidance issued on January 28, 2020 reflected the best information available at the time as well as our best estimates about the pace of return to work following the end of the extended Chinese New Year holiday on February 10. Work is starting to resume around the country, but we are experiencing a slower return to normal conditions than we had anticipated. As a result, we do not expect to meet the revenue guidance we provided for the March quarter due to two main factors.

Apple will fall short of its guidance for the March quarter due to both constrained worldwide iPhone supplies and lower customer demand for Apple products in China,

Apple says all of its iPhone manufacturing partner facilities are located outside the Hubei province. But while all of these facilities have reopened, they are ramping up more slowly than we had anticipated.

Apple also says store closings and limited hours have significantly reduced customer traffic. The company says corporate offices and contact centers have reopened and online stores have remained open.

Outside of China, customer demand for Apple products and services has remained strong to date and in line with the Cupertino firm’s expectations.

The company says it is monitoring the situation and will provide information on its April quarterly earnings call. It is also more than doubling its previously announced donation to help in the fight against the Coronavirus

Bloomberg has shared Tim Cook’s email memo to Apple employees concerning the situation:

Team,

The response to COVID-19 has touched the lives of so many in the Apple family, and I want to thank everyone for their dedication, empathy, understanding, and care. Today, we more than doubled our donation to support the historic and global health response.

Our paramount concern is with the people who make up Apple’s community of employees, partners, customers, and suppliers in China. I also want to recognize the many people across our teams who have been working around the clock to manage Apple’s global COVID-19 response with diligence and thoughtfulness.

Corporate offices and contact centers have reopened across China, and our stores are starting to reopen, but we are experiencing a slower return to normal conditions than we had anticipated. This afternoon, I shared this update with our community of shareholders and investors to note that we do not expect to meet the revenue guidance we provided for the March quarter. Outside of China, customer demand across our product and service categories has been strong to date and in line with our expectations. Apple is fundamentally strong, and this disruption to our business is only temporary.

Our first priority – now and always – is the health and safety of our employees, supply chain partners, customers, and the communities in which we operate. Our profound gratitude is with those on the front lines of confronting this public health emergency.

Tim

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