Faced with the epidemic, the group had given a range of forecast sales for its second quarter wider than usual, between 63 and 67 billion dollars. A range they will not reach.
The list of companies affected by coronavirus is growing. Latest: Apple. The apple brand will not reach its sales targets this quarter due to the epidemic of the new coronavirus, a sign that the slowdown in production and consumption in China is affecting the major groups more and more seriously.
The health crisis weighs on both supply and demand. The tech giant cites difficulties in supplying the iPhone, made in China, and the closure of its stores in the country.
A return to “normal” conditions which takes time
In late January, when the record results were published thanks to strong demand for the range of iPhone 11 released before the holidays, Apple had already pointed out that the epidemic was causing uncertainty. The group had therefore given a range of forecast sales for its second quarter wider than usual, between 63 and 67 billion dollars (58 and 62 billion euros).
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But the American company no longer plans to achieve this, even if production in China “begins to resume”. Apple has subcontractors in the Wuhan region, the epicenter of the epidemic, but also alternative suppliers. “The return to normal conditions takes more time than we had anticipated”, details the Californian group, evoking a “shortage of iPhone which will temporarily affect [its] income in the world”.
Apple also indicates that demand has not decreased only in China. “We are gradually reopening our stores and we will continue, as regularly and as safely as possible,” said the Californian company, adding that its offices, call centers, and online stores have never stopped working.
Since the onset of the disease in December in Wuhan, nearly 1,900 people have died and more than 72,300 have been infected in mainland China (excluding Hong Kong and Macao), according to the latest official figures released on Tuesday. “Our thoughts go first to the communities and individuals most affected by the disease […]. Apple will more than double its previously announced donation to support this historic public health effort, “ said the US group.
According to the Managing Director of the International Monetary Fund, Kristalina Georgieva, the coronavirus epidemic will cost 0.1 to 0.2 points of growth. But she stressed that it was still very difficult to assess the impact on the economy.
Losses for Disneyland
Apple is not the first group to change its forecast due to viral pneumonia. Last week, Pernod Ricard revised its annual organic operating profit target downward. China is the second market for the spirits group, where it generates 10% of its sales.
The luxury industry is particularly concerned. The French group Kering (owner in particular of Gucci, Yves Saint Laurent, etc.) thus recorded a sharp drop in sales in mainland China and the clothing house Burberry warned of a “significant negative impact”.
Top-of-the-line electric vehicle maker Tesla announced when its results were released in late January that its mega plant in Shanghai would be shut down on the injunction of the Chinese government, which would cause delays in the production of the Model 3 and could slightly affect the group’s quarterly profits.
Disney, for its part, estimated that its amusement parks in Shanghai and Hong Kong could lose $ 280 million in all if they remain inaccessible for two months.
In Brussels, Mario Centeno, the president of the Eurogroup, the inner circle of the 19 finance ministers of the eurozone, said on Monday that he expected a “temporary” impact of the new coronavirus on European growth. “The appearance and spread of the coronavirus and its impact on public health, human lives and economic activity are a source of growing concern, “ the European Commission said on Thursday in a statement.
