Apple shares tumbled as much as 2.3% in early Tuesday trading after the company announced coronavirus fallout will cut into its quarterly revenue more than first expected.
The tech giant nullified its previous guidance for the March quarter, citing “temporarily constrained” iPhone supply and weakened demand in China. The Foxconn factories that produce iPhones are gradually ramping up production in the country over the next few months after a mandatory shutdown, creating a temporary product shortage for the flagship product, according to a Monday press release.
Apple’s on-the-ground operations in China will also take a hit in the near term, as all of its stores and several partner stores were closed to prevent further contagion. Some locations have since resumed operations, but with reduced hours and weaker customer traffic. The company plans to reopen its retail locations “as steadily and safely” as it can, according to the release.
The stock slump saw Apple wipe out as much as $33 billion from its market valuation after Tuesday’s open.
The guidance issued in Apple’s previous earnings report “reflected the best information available at the time as well as our best estimates about the pace of return to work” after the extended Lunar New Year holiday, the company said.
