Economy

Apple finally says repairs hurts its bottom line

Apple finally says repairs hurts its bottom line

Stocks are widening their losses on Wall Street after Apple warned of a steep slowdown in iPhone sales in China.

Many analysts and investors had anxious about a slowdown in iPhone sales since the company said in November it would stop disclosing unit sales data for its phones and other hardware products.

Cook also said in the letter that fewer carrier subsidies, price increases based on the strength of the USA dollar and cheaper battery replacements caused the weak iPhone upgrades for the quarter.

In his letter to Apple shareholders, Cook gave no China sales numbers for the final quarter of the year.

While disclosing a plunge in demand for the iPhone during Apple's recently completed quarter, CEO Tim Cook avoided any mention of whether increased iPhone prices might have played a role. Better iCloud storage, an Apple News content subscription (which I will happily pay for if it means no longer needing to visit ad tracking-riddled websites), an Apple video subscription, and more.

The promotion in China is available until January 31, around the same time the iPhone maker is expected to release its fiscal first-quarter earnings.

"The argument could be made that they to some extent priced themselves out of the market", said Tom Forte, an analyst at D. A. Davidson.

Apple did not immediately respond to a request for comment on Thursday.

At the news conference, Trump also voiced his displeasure with Apple for making products in China, although he falsely asserted Apple CEO Tim Cook would soon change that.

Apple iPhone
Apple stock plummeted 10% erasing more than 74 billion dollars in market value

The Institute for Supply Management said its index of USA manufacturing fell to its lowest level in two years, and new orders have fallen sharply since November. Apple shares plummeted almost 8 percent in after-hours trading and pulled down a bevy of consumer stocks with exposure to the Chinese market.

Apple said that it expects weak iPhone sales in other emerging markets, driving down revenue despite some positive signs in developed markets and in its other products and services.

Under the new guidance, Apple says revenue will be around $84bn, well short of the $89-93bn range Apple had estimated and a sizeable drop from the $88.3bn revenue haul Apple reported in Q1 FY 2018.

First, and perhaps most significant is this - How many iPhones does Apple sell to people simply because the battery in their existing iPhone is worn? The news comes as USA earnings season looms around the corner. On Thursday it was also announced that Apple is likely to remove some iPhones from stores in Germany, as Qualcomm moves to enforce an earlier court order banning the sale of some iPhone models in the country.

And Apple has "failed to acknowledge the possibility that current iPhone prices are simply too high", he wrote.

"Don't forget this: Apple makes their product in China", Trump said.

Apple gave up 9.2 percent in early trading Thursday. That put Apple's market share in fifth place in the Chinese market.

The yield on the 2-year Treasury note slid to 2.39 percent from 2.50 percent, and the yield on the 10-year note sank to 2.56 percent from 2.66 percent.

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