Apple Inc. is warning investors that it won't meet its second-quarter financial guidance because the viral outbreak in China has cut production of iPhones.
The Cupertino, California-based company said Monday that all of its iPhone manufacturing facilities are outside Hubei province, the epicenter of the outbreak, and all have been reopened. But the company said production is ramping up slowly. Apple says demand for iPhones is also down in China because many of Apple's 42 retail stores there are closed or operating with reduced hours. China is Apple's third largest retail market for iPhones, after the U.S. and Europe. Outside China, Apple said iPhone demand has been strong and is in line with the company's expectations. On Jan. 28, Apple said it expected second quarter revenue between $63 billion and $67 billion. Apple's second quarter ends March 30. The death toll from COVID-19, a disease caused by the new coronavirus, was 1,770 as of Monday.
Business in Los Angeles is feeling the impact as well. With the slowdowns or complete stoppages at Chinese factories due to the outbreak, imports of goods coming through major U.S. ports like L.A./Long Beach have slowed as well. Fewer flights to and from China from Southern California means not only a hit in the revenue from Chinese tourists who come to visit the area, but also for small businesses that organize trips from the U.S. to China.
Today on AirTalk, we’ll explore the implications for U.S.-Chinese business relations as both sides work to deal with the outbreak.
With files from the Associated Press
Stephen Cheung, president of World Trade Center Los Angeles, a nonprofit organization that focuses on attracting foreign direct investments to the Los Angeles region, and former director of International Trade for The Port of Los Angeles; he tweets @WTCLAStephen
Doug Barry, Senior director of communications and publications with The US China Business Council, a nonprofit organization representing approximately 200 U.S. companies that do business with China