Coronavirus to dent Apple sales

Apples shares have fallen five per cent after vendor warns it will fail to hit quarterly revenue target

Apple has joined a host of tech giants to warn that the ongoing coronavirus pandemic is going to affect its financial performance, as well as cause global iPhone shortages.

The US vendor has told investors that it will fail to meet its quarterly revenue target of $63bn to $67bn due to the outbreak.

Apples shares have fallen five per cent following the guidance.

The company explained that its factories in the Hubei presence in China have reopened but are recovering slower than expected.

"The first is that 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."

As a result, iPhone supply shortages are expected to temporarily affect revenues worldwide.

"The second is that demand for our products within China has been affected. 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."

Apples' announcement has also had a knock-on effect on chip vendors Qualcomm and Broadcom, who are part of the iPhone supply chain. Shares for both also fell by two per cent.

Apple said it will update investors again in its next earnings call in April.