Corona Virus could cost Apple $ 4 billion in the first quarter of 2020 because of a product shortage

Apple could lose $ 4 billion in revenue amid the Corona virus threatens to seriously affect the company’s supply chains in China.

On Monday, Apple warned it did not expect high profit targets in March because of the Corona virus. The new strain, originating in Wuhan, the capital of Hubei province, killed more than 1,700 people and infected more than 71,000 people.

” We do not expect to achieve a forecasted profit in the quarter ending in March because of two main factors,” Apple said in a statement Monday. The first is the delay in the iPhone production line by Corona virus, and the second is the demand of the Chinese market is also much lower than before.

According to analysts at Instinet, an independent broker in New York, a delay in the iPhone and AirPod production line could bring Apple revenue down to about $ 61 billion compared to a forecast of $ 65 billion. ” Apple states that all of its factories are outside of Hubei province and reopened … but much later than expected,” said Jeff Kvaal, Instinet director.

Although the Corona virus is spreading in more than 25 countries worldwide, the cases are mostly concentrated in China. More than 16 cities in the country have been put in a blockade, affecting nearly 50 million people – tourist destinations and shops are closed, and the New Year holiday in 2020 is forced to last long. than the original schedule to minimize the spread of the virus.

According to The New York Times, 42 Apple stores in China have closed, and only 7 stores have been reopened. The company says it will continue to monitor the situation, while confirming the health and safety of people affected by the Corona virus are the company’s primary concerns.

Although the announcement made by Apple is quite unusual, Apple is not the only company affected by the Corona virus.

China is home to a quarter of the world’s manufacturing operations, and the car industry, along with other technology companies like Facebook, are facing the sluggish state of their supply chains. surname.

Reference: BusinessInsider