19 Feb 2020
Apple lowering revenue guidance due to coronavirus is no reason to panic, says GlobalData
Posted in Technology

Following the news that Apple does not expect to meet its revenue guidance for the March quarter;

Lynnette Luna, Principal Analyst at GlobalData, a leading data and analytics company, offers her view on Apple's current challenges:

'Apple lowered its revenue guidance because of the coronavirus's impact on both production and sales in China, where most iPhones are made. But that is not a reason to panic about the world's supply of Apple products. While China is home to much of Apple's manufacturing, and Chinese consumers are big buyers of Apple products, the slowdown should be a temporary glitch for Apple.

'Sales of Apple's products remain strong outside of China, and this slowdown does not mean less demand for Apple products inside of China - it simply delays that demand to later in 2020. Moreover, Apple's most recent quarterly results were strong. It can weather a temporary slowdown.

'We also do not expect Samsung to announce any impact of the coronavirus on its production, as about half of its manufacturing facilities reside in Vietnam. It also has minimal exposure in China as the company already has a shaky position in the market where local vendors such as Huawei, OPPO and Vivo are gaining ground with their full-featured smartphones at affordable prices.

'However, these leading local Chinese vendors are facing strong headwinds from the coronavirus, and we will expect them to suffer more than Apple and Samsung in the first half of 2020.'

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GlobalData plc published this content on 19 February 2020 and is solely responsible for the information contained therein. Distributed by Public, unedited and unaltered, on 19 February 2020 17:04:00 UTC