Apple lowers revenue expectations for Q1 2020 due to coronavirus

The coronavirus outbreak has affected the world on several fronts. The virus has heavily impacted the global tech industry, causing the cancellation of major events and forcing companies to restrategize. One such company is Apple, which announced that it will not hit revenue estimates for the first quarter of 2020.

In a post on the company’s newsroom website, Apple stated that it does “not expect to meet the revenue guidance [it] provided for the March quarter due to two main factors.” The first is that the iPhone’s supply chain has been “temporarily constrained” due to the closure of factories and production facilities in China. The coronavirus outbreak forced multiple points in Apple’s supply chain (as well as other tech companies’ supply chains) to close. This, in turn, has slowed or outright halted production. Fewer iPhones made means fewer iPhones could be sold, which obviously affects revenue.

Coronavirus isn’t the sole culprit for Apple’s lowered expectations. Demand for Apple products, primarily the iPhone, has steadily slowed in China. While the impact of the viral epidemic has worsened this decline, demand began to fall last quarter, well before the outbreak started. The coronavirus may have merely exacerbated the existing financial problems Apple faces in China.

Apple did not give a concrete estimate for revenue for this quarter, simply stating that it did not expect to meet its existing revenue guidance. Apple’s stock (AAPL) fell roughly 3% when trading opened Tuesday morning.