Apple has confirmed that the coronavirus will cause a global iPhone shortage which is likely to eat into its revenues and reduce profits.
The tech giant issued a long, frank statement which pays tribute to health workers fighting the disease but also bluntly warns of its financial impact. Apple’s iPhone factories are located outside the Hubei
Province where Wuhan, the region’s capital, is currently on lockdown as authorities battle to contain the spread of Covid-19, the official name of the deadly new coronavirus.
It has now cut its estimated profits for the year, prompting a drop in stock prices on markets across the world driven by fears that the disease will cause a global economic slump.
‘We do not expect to meet the revenue guidance we provided for the March quarter due to two main factors,’ Apple continued.
‘Worldwide iPhone supply will be temporarily constrained.
While our iPhone manufacturing partner sites are located outside the Hubei province and while all of these facilities have reopened, they are ramping up more slowly than we had anticipated.
‘The health and well-being of every person who helps make these products possible is our paramount priority, and we are working in close consultation with our suppliers and public health experts as this ramp continues.
These iPhone supply shortages will temporarily affect revenues worldwide.’
Apple also said that ‘demand for our products within China has been affected’ and continued: ‘All of our stores in China and many of our partner stores have been closed. ‘Additionally, stores that are open have been operating at reduced hours and with very low customer traffic. We are gradually reopening our retail stores and will continue to do so as steadily and safely as we can.
Our corporate offices and contact centres in China are open, and our online stores have remained open throughout.”