The past Christmas business has gone significantly worse for Apple than expected. The iPhone group lowered its revenue forecast for the past three months to $ 84 billion, compared with $ 89-93 billion in November.
The strong correction goes back mainly to the weaker iPhone sales in China, stressed CEO Tim Cook on Wednesday. Apple has underestimated the general economic slowdown in the country and its consequences. The trade conflict between the US and China also contributed to this downturn.
But even in some developed markets, not so many users have switched to new iPhones as thought, admitted Cook. The affected countries did not name Apple.
Apple sold about 64 million iPhones in the Christmas quarter, estimated the finance company BTIG. That would be 18 percent less than a year ago. For the current quarter, BTIG analyst Walt Piecyk expects 42.5 million iPhones sold, down 19 percent.
At the same time, Apple’s problems in China are fueling concerns that the economic slowdown is affecting consumer spending and affecting other international companies that are heavily dependent on the giant market. The US-Donald Trump trade dispute intensifies the uncertainty – even if, for example, Apple devices have not been directly affected. At the same time, some analysts believe that the conflict is causing consumers to buy domestic goods more patriotically.
The Christmas quarter is traditionally the most lucrative for Apple. The group set several records in terms of sales and profits in these three months. In 2017, there was a quarterly revenue of $ 88.3 billion and $ 20 billion profit. In China, Apple made about a fifth of its business at that time.
The iPhone is the most important Apple product and last brought about 60 percent of total revenue. Already in the current Christmas business, the alarm signals piled up. Several media reported that Apple had reduced production orders to iPhone pavers. Especially in China, local smartphone providers such as Xiaomi, Huawei or Vivo have been on the rise for years and have pushed back the global market leader Samsung.