Log in
E-mail
Password
Remember
Forgot password ?
Become a member for free
Sign up
Sign up
New member
Sign up for FREE
New customer
Discover our services
Settings
Settings
Dynamic quotes 
OFFON

MarketScreener Homepage  >  News  >  Economy & Forex  >  All News

News : Economy & Forex
Latest NewsCompaniesMarketsEconomy & ForexCommoditiesInterest RatesBusiness LeadersFinance Pro.CalendarSectors 
All NewsEconomyCurrencies / ForexCryptocurrenciesEconomic EventsPress releases

Coronavirus threatens Apple supply chain, sales; shares drop

share with twitter share with LinkedIn share with facebook
share via e-mail
02/18/2020 | 05:27pm EDT
Customers walk past an Apple logo inside of an Apple store at Grand Central Station in New York

Shares of Apple Inc fell 2 % on Tuesday and dragged the stocks of its suppliers across the globe lower, after the iPhone maker warned of lower sales in the current quarter acknowledging that the coronavirus outbreak was pressuring its supply chain.

The drop in Apple's stock is set to wipe nearly $30 billion off its market capitalization, just as it was inching closer to $1.5 trillion in value. The stock was trading down at $318.74.

However, several Wall Street brokerages dubbed Apple's update forecast as a "near-term headwind," saying the company is performing strongly outside China and the launch of 5G phones later this year would further boost sales.

"We believe any material weakness in Apple shares as a result of the March 20 quarter revenue shortfall will prove to be a buying opportunity," analysts at Piper Sandler wrote in a client note.

"The iPhone supply constraints in the current quarter could result in pent-up demand for future quarters," they said.

In late January, Apple had forecast $63 billion to $67 billion in revenue for the quarter ending in March. It did not provide a new revenue estimate or a profit forecast on Monday.

Venture capital firm Loup Ventures expects March quarter revenue to be in the range of between $58 billion and $60 billion, with a 12% contribution from Greater China.

Manufacturing plants in China that produce Apple's iPhone and other electronics have begun to reopen, but they are ramping up more slowly than expected, Apple said on Monday. That will mean fewer iPhones available for sale.

One of the primary iPhone manufacturing facilities in China is operating at a 25% factory utilization rate as many workers remain absent, Cowen analysts estimated.

"We believe utilization rates will improve linearly over the next several weeks to ~50% by mid-March and followed by a big improvement in late March to normal levels."

Brokerage Canaccord Genuity expects Apple to sell 38 million iPhone units during the current quarter, eight million less from its earlier estimate.

Shares of Apple suppliers Taiwan Semiconductor Co Ltd, Qualcomm Inc, Intel Corp, Broadcom Inc , Texas Instruments Inc, Micron Technology Inc, Microchip Technology Inc and Qorvo Inc, fell between 1% to 3% in premarket trading.

Shares of European chipmakers STMicroelectronics and Dialog Semiconductor were down in the low single digits and Asian supplier Foxconn Technology Co Ltd was down marginally.

(Reporting by Munsif Vengattil and Supantha Mukherjee in Bengaluru; Editing by Bernard Orr)

Stocks mentioned in the article
ChangeLast1st jan.
APPLE INC. 0.72% 267.99 Delayed Quote.-8.74%
BROADCOM INC. -2.60% 254.3 Delayed Quote.-19.53%
CANACCORD GENUITY GROUP INC. 0.00% 4.68 Delayed Quote.-3.31%
DIALOG SEMICONDUCTOR PLC 6.56% 27.76 Delayed Quote.-38.46%
FOXCONN TECHNOLOGY CO., LTD. 2.50% 51.2 End-of-day quote.0.79%
INTEL CORPORATION -3.12% 57.14 Delayed Quote.-4.53%
MICROCHIP TECHNOLOGY, INC. -1.35% 78.45 Delayed Quote.-25.09%
MICRON TECHNOLOGY, INC. -4.47% 46.13 Delayed Quote.-10.21%
QORVO, INC. -4.49% 83.11 Delayed Quote.-28.50%
QUALCOMM, INC. -2.39% 71.58 Delayed Quote.-18.87%
STMICROELECTRONICS 4.87% 22.2 Real-time Quote.-7.38%
TEXAS INSTRUMENTS -2.25% 107.69 Delayed Quote.-16.06%
share with twitter share with LinkedIn share with facebook
share via e-mail
Latest news "Economy & Forex"
02:52aJapan auto industry seeks to avoid suspending operations, but worker safety priority
RE
02:48aWHAT'S NEWS : World-Wide
DJ
02:48aWHAT'S NEWS : Business & Finance -- WSJ
DJ
02:46aChina says its trade faces unprecedented challenges due to coronavirus
RE
02:39aDollar falls after Fed bolster lending and coronavirus fears ease
RE
02:36aDollar falls after Fed bolster lending and coronavirus fears ease
RE
02:35aChina's March auto sales plunge slows, pandemic clouds outlook
RE
02:18aJapan's battle with pandemic may mark end of Abe's fiscal experiment
RE
02:18aJapan finmin - not considering at all asking BOJ to finance debt
RE
01:40aJapan sees 51 coronavirus-related bankruptcies
RE
Latest news "Economy & Forex"