Cook says Apple expects to make between $5-billion and $9-billion less this quarter than previously forecasted
Apple chief Tim Cook slashed the tech giant’s projections for Q1 2019 revenue in a letter to shareholders on Wednesday, blaming the cutback on a myriad of issues, including underwhelming iPhone sales in China.
Cook said Apple has lowered its revenue guidance to $84 billion for the upcoming quarter — a healthy decrease from the $89 billion to $93 billion the company had originally anticipated.
“Lower than anticipated iPhone revenue, primarily in Greater China, accounts for all of our revenue shortfall to our guidance and for much more than our entire year-over-year revenue decline,” Cook wrote.
Cook added while iPhone sales have dropped, its other categories, including Services and Mac sales, have increased about 19 percent year-over-year.
China was a primary focus for Cook in his letter, with the chief executive pointing to “rising trade tensions with the United States,” as well as the country’s overall economic downturn during the second half of 2018.
“As the climate of mounting uncertainty weighed on financial markets, the effects appeared to reach consumers as well, with traffic to our retail stores and our channel partners in China declining as the quarter progressed,” Cook added. “And market data has shown that the contraction in Greater China’s smartphone market has been particularly sharp.”
Cook also warned new iPhone upgrades were “not as strong” as Apple expected in several countries.
Apple’s stock — which had already suffered a brutal stretch to close 2018 — fell nearly 7 percent in after-hours trading to $147 per share.