Apple sales slow due to economic challenges in China

Apple has revised revenue forecasts causing shares to plummet 7%. Revenue for the three months to 29 December now stands at $84 billion (£67 billion). This is the first warning the retailer has made to investors in over 15 years.

The iPhone manufacturer blamed the economic environment in Greater China, where financial market uncertainty has seen a reduction in footfall to retail stores and channel partners across the country.

“While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration,” Apple CEO, Tim Cook, wrote in a letter to investors. “In fact, most of our revenue shortfall to our guidance, and over 100% of our year-over-year worldwide revenue decline, occurred in Greater China across iPhone, Mac and iPad.

“China’s economy began to slow in the second half of 2018. The government-reported GDP growth during the September quarter was the second lowest in the last 25 years. We believe the economic environment in China has been further impacted by rising trade tensions with the United States.”

The CEO said he still believed the region holds a “bright future” for Apple.

The retailer also blamed a slowdown in iPhone upgrades, as well as “constrained” sales of products including Apple Watches, AirPods and iPads.