iPhone sales got hit by coronavirus. Now, Apple’s told us how bad

To update: Apple Financial results released on April 30 IPhone sales fell more than 6%, but services and wearables also rose in double digits. Apple’s results were the most recent example of this how big the technology is getting bigger during the corona virus.

When Apple warned in mid-February that the Corona virus It would be a surprise if the company’s sales and iPhone supplies were affected. The virus had hit China and part of Europe, but had not yet seriously disturbed life in the United States.

Two months later, more than 1 million cases and 60,000 deaths were confirmed in the United States, and many people live under state restrictions. Medical authorities worldwide have confirmed 3.2 million cases and 228,000 deaths. by data compiled by Johns Hopkins University & Medicine.

On Thursday afternoon, Apple will go from ringing the alarm to sharing details if it does publishes its quarterly results. Unlike in previous years, investors have no idea what to expect. Many companies have withdrawn the guidance they gave Wall Street, simply saying that they will not meet the numbers previously offered.

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In Apple’s case, the iPhone maker had once expected to generate sales of between $ 63 billion and $ 67 billion, even if early warning signals for the corona virus showed disruption in manufacturing and supply across China.

“Are the numbers important at all?” Toni Sacconaghisaid a longtime Apple analyst at AllianceBernstein in a message to investors. He added that he doesn’t have much conviction in forecasts, also because “everyone knows that … the results won’t be good”.

He also expects the “worst to come”.

Whatever Apple says is interpreted as an exchange of blows as the iPhone maker is one of the most highly valued technology companies in the world. Sales and profits are in the shadow of most other companies. In addition, the $ 220 billion that Apple has in the bank is larger than the gross domestic product of many countries, including Greece, New Zealand and Panama.

Nobody wonders whether Apple will survive the corona virus and its economic consequences, just as the company easily weathered the recession a decade ago. Apple analysts use words like “economic abyss”, “dark days ahead” and “dark valley” to predict what the next year will look like.

According to Yahoo, analysts expect average earnings of $ 2.28 per share on sales of $ 54.7 billion, a decrease of more than 5% over the same period last year.

“The negative impact of COVID-19-driven global social distancing on the overall economy and some of our company’s end markets has been severe,” Goldman Sachs analysts said. The company also downgraded Apple’s shares to “sell”, partly because other analyst estimates suggest keeps optimistic.

Apple declined to comment on its outcome.

Apple’s 5G future

Although Apple has released one new MacBook Air, IPad Pro, Magic Keyboard, and the well-timed iPhone SE for $ 400 this year, Apple watchers won’t care. The biggest question on everyone’s lips will be the next iPhone, which is expected in autumn.

The rumor mill is increasingly pointing to an iPhone with 5G radio technology. This new cellular signal promises download speeds 10 to 100 times faster than what we have now.

This is one of the reasons why almost every new phone has built 5G this year or will offer a 5G variant. That includes that Samsung Galaxy S20 5G, the LG V60 ThinQ 5G and the OnePlus 8. Aside from many that have a striking “5G” in their names, all of these phones usually also carry a bonus. However, the OnePlus 8 for $ 699 shows that prices are falling.

While the next iPhone is also expected to have 5G, the bigger question is when. There are increasing rumors that the iPhone 2020 could be delayed by production slowdowns and delivery bottlenecks related to the corona virus. A report in Nikkei citing anonymous sources with “direct knowledge“From Apple’s internal discussions said the phone could be” delayed for months. “Meanwhile, the Wall Street Journal said on Monday his sources Fix the delay to about a month.

Unfortunately, analysts say that even Apple is unlikely that anyone will really know if the iPhone is delayed until just before launch. And even if it starts on time or a little later, almost all experts agree that the company initially only has limited deliveries.

Notoriously tense Apple CEO Tim Cook is likely to stick to general statements about how the product range looks in the future when he speaks to analysts on Thursday after his company’s earnings announcement. But for him it is also an opportunity to signal how one of the largest companies in the world copes with one of the worst health disasters in generations.

For one, Morgan Stanley analyst Katy Huberty told investors in a memo last week that Apple is likely to find out how the iPhone 5G device can become a hit. “Apple took its medicine early,” she said.