Finance, ICT - Apple Warning Alarms Investors
Apple is blaming economic weakness in China for slowing sales of iPhones, and rattling investors by slashing its quarterly sales forecast.
In a letter to shareholders, Apple's Chief Executive Officer Tim Cook said the company's revenue will be US$84 Billion for the October-December quarter. That's way below Apple's earlier forecast of between $89 Billion and $93 Billion. Analysts expected $91.5 Billion, according to IBES data from Refinitiv. The official results are scheduled to be released on 29 January, but if the new figures hold it will represent an fall of alomost 5 Percent from the same period last year and represent the firm's first year-on-year quarterly decline since 2016.
The news sent Apple shares tumbling 7.7 percent in after-hours trade, triggering a broader selloff in the stock market and dragging the company's market value below $700 Billion.
"The trade tensions between the United States and China put additional pressure on their economy," wrote Cook, referring to the the $200 Billion in tariffs the two countries slapped on each others' good. Cook also said that consumers in other markets weren't buying iPhones anticipated, possibly because of the four figure price tag.