Apple sold fewer than 500,000 iPhones in China last month amid the ongoing curbs on travel and transport, according to government data shared on Monday (via Reuters).
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Shipments of Apple devices slumped to 494,000, from 1.27 million in February 2019. In January, their shipments had held steady at just over 2 million.
That amounts to an almost 60 percent slump in iPhone sales – worse than IDC's forecasted drop in overall smartphone sales of roughly 40 percent in the first quarter due to the impact of coronavirus.
China's restrictions on public movement were enforced in late January just ahead of the Lunar New Year Festival and remained in place throughout most of February, which appears to have crippled demand for smartphones.
According to data from the China Academy of Information and Communications Technology, mobile phone brands shipped a total of 6.34 million devices in February, down 55 percent from 14 million sold in February 2019.
Android brands like Huawei and Xiaomi suffered the worst, with shipments collectively declining from 12.72 million units in February 2019 to 5.85 million.
Apple closed all 42 of its retail stores in China at the beginning of February as the outbreak in China worsened, but most of the stores have re-opened, albeit operating with shortened hours. New infections and deaths reported in China have been declining in recent weeks, according to government data, suggesting the virus may have peaked there.
Apple in mid-February announced that its financial guidance for the March quarter would fall short due to the COVID-19 outbreak. During the January earnings call, Apple said it expected to see revenue of $63 to $67 billion in the March quarter, but that is no longer a goal the company will be able to meet.
Apple cited lower customer demand in China and constrained iPhone supplies worldwide as the factors leading to lower than expected revenue.
Top Rated Comments
You raise interesting points, but I don’t think it’s that deep. Apple makes a lot of sales from their stores. People aren’t going out to their stores as much because of the lockdown.I wonder why is it that when people worry about their lives and the lives of their loved ones, when they are under a mandatory quarantine or complete lockdown buy the authorities, they suddenly stop buying iPhones?
What is the correlation? Could it be that they want to hunker down and try to save money to use it on food, medicine, rent, etc.?
This is the first report that I’ve seen on how the calamity like an epidemic (turned into a pandemic) can burst the bubble that Apple has created.
Phones are a means of communication and now means of getting information and conducting commerce, but they are not supposed to be luxury status symbols. Apple created a fashion of having to buy a new $1,000 gadget every year just to show your friends that you can. It all works well and makes Apple tens of billions of dollars in profit every quarter until a calamity strikes. Then, people suddenly realize that there much more important things in life to take care of than buy a new smartphone annually. They figure their old smartphones work just fine, and they save the money for more essential goods and services than smartphone.
You think the behavior in the West will be different? You think people will be snatching up new $1,000 smartphones when their relatives are sick with Coronavirus and they are quarantined at home?
This is only the beginning. Apple has now become an nom-essential company. If one loses the iPhone in the midst of a Coronavirus pandemic and needs a phone to communicate with the relatives and to get information or order online food delivery while under a mandatory lockdown, one can spend $150 on a decent Android phone that will do all those things. Will one buy a $1,000 (or more) iPhone in that sort of situation? Most people won’t.
People also probably would rather save their money like you said instead of buying any piece of electronics, not just Apple.
I’m sure a lot of industries are being impacted. Not just Apple. Apple will absolutely recover though. There’s not much to worry about IMO.
Maybe because people can't survive long without food? Without iPhone (or any phones) on the other hand they would probably live even longer.Why weren’t people dying from hunger when they were under the lock down? Going to an Apple store is not the only way to buy an iPhone just like going to a grocery store is not the only way to buy groceries. If they could figure out how to get food under the lockdown, why couldn’t they figure out how to buy iPhones?
So you ignore all but the first few words of my post, including the part about missing income?Why weren’t people dying from hunger when they were under the lock down? Going to an Apple store is not the only way to buy an iPhone just like going to a grocery store is not the only way to buy groceries. If they could figure out how to get food under the lockdown, why couldn’t they figure out how to buy iPhones?
According to this, still a ton of active cases in China.It's about to get cleared in China, aka currently infected number -> 0,
https://www.arcgis.com/apps/opsdashboard/index.html#/bda7594740fd40299423467b48e9ecf6
How many they have left doesn't really matter. In immunology, they care about the current R0 index and the current death rate. That is if the virus is spreading, contained, or reducing. If you look at the data now, by late-April China will recover. The medical supply production will outpace demand.According to this, still a ton of active cases in China.
https://www.arcgis.com/apps/opsdashboard/index.html#/bda7594740fd40299423467b48e9ecf6
Based on the current model by the Chief Chinese Scientist on nCov19, the virus cases outside of China will surpass China by mid-April and will reach a peak in June.
The good thing is, China will have enough manufacturing volume on the key components by that time. So, that's good. If they don't place a ban on export to the US, which Trump may be less than pleased ironically.
A Biomed Lab in Shanghai just created a vaccine, the scientist who created it tried it on himself already lol... It's been quite effective when trialled on lab rats and monkeys/primates. It's been evaluated for clinical trials. So far, it's the only vaccine on the planet that has been used on human and that person didn't die and yet still seem promising.
So if the congress can help CDC and FDA to get some of that, it can save lots of lives. If we can make them here, it's even better. But, who cares about American bloodsucking big pharms? It's probably in the public interest to directly import ones from China, cheaper and more reliable. The Chinese make 70% of all the active ingredients in all drugs sold in the world outside of China. You can think of active ingredients as "the real drug inside drugs", aka, not cornstarch.