Apple is warning investors that it won’t meet its second-quarter financial guidance as a consequence of the coronavirus outbreak in China, which has forced it to cut production of iPhones.
The technology company said Monday that all of its iPhone manufacturing facilities are outside Hubei province, and all have been reopened, but production is ramping up slowly.
“Work is starting to resume around the country, but we are experiencing a slower return to normal conditions than we had anticipated. As a result, we do not expect to meet the revenue guidance we provided for the March quarter due to two main factors,” the company said in a press release.
Those factors are decreased iPhone manufacturing capabilities and weaker demand for its products in China, with Apple noting that its retail stores in the country are closed or operating with reduced hours.
On Jan. 28, Apple said it expected second quarter revenue between $63 billion and $67 billion. Apple’s second quarter ends March 30. Apple says the situation is evolving and it will provide more information on its next earnings call in April.
The majority of American companies with manufacturing operations have been hampered by the deadly virus. Travel restrictions and quarantines imposed by the Chinese government mean that many factory employees have yet to return to their jobs after the extended Lunar New Year holiday.
As a result, nearly 8 in 10 companies surveyed by the American Chamber of Commerce in Shanghai (AmCham) say they don’t have enough staff to run a full production line.
