Published: Fri, January 04, 2019
Markets | By Jeffery Armstrong

Apple plunges after slashing revenue guidance for its holiday quarter (AAPL)

Apple plunges after slashing revenue guidance for its holiday quarter (AAPL)

Cook said revised first quarter revenue forecasts to $84 billion, down from the company's initial estimates of $89-$93 billion. Where the iPhone X launched in Apple's first fiscal quarter of 2018, the iPhone XS and XS Max shipped in Q4 2018, "placing the channel fill and early sales in that quarter" and skewing comparisons with the current quarter.

All other guidance metrics-gross margin, operating expenses, other income, and expense, and tax rate-remained generally unchanged, Apple said.

Cook also confirmed that iPhone upgrades in several developed markets "were not as strong as we thought they would be".

In fessing up to the looming fiscal disappointment, the Apple boss blamed the shortfall not on the eye-wateringly high prices for its latest lines of kit, but rather on the people of China, who let Apple down by not purchasing as many shiny doodads as was expected of them.

Apple will have to figure out ways to fearless macroeconomic woes like this, and that might mean learning to make more money from non-iPhone products in its catalog.

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The new revenue target would be below the $88bn reported in the same period past year.

"And market data has shown that the contraction in Greater China's smartphone market has been particularly sharp", he wrote.

Cook said the slowing in China's economy was made worse by "rising trade tensions with the United States". China's economy has been pinched by the ongoing Sino-US trade war which is spilling over to other Asian economies.

However, Apple continues to be optimistic about China.

"This is not only great for the environment, it is great for the customer, as their existing phone acts as a subsidy for their new phone, and it is great for developers, as it can help grow our installed base", he said. So,"anyone with an iPhone 6 or later" could get a new battery at under $30, a move that seems to have impacted iPhone sales adversely.

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Apple has shaken the business world by lowering its sales and revenue forecast for the next quarter.

"We expected economic weakness in some emerging markets". He also pointed out that the number of its devices in active use worldwide is now greater than ever before, and had grown by approximately 100 million in 2018.

Tim Cook, Apple's chief executive, said the company would report revenues of around $84bn (£67bn) for the three months to the end of December, usually a blockbuster trading period that comes after new iPhones are released.

Apple also reported hitting "records" in "emerging markets" such as Mexico, Poland, Malaysia, and Vietnam.

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