Apple Cuts Revenue Forecast Due To Poor iPhone Sales In China
The Top-most smartphone brand, Apple revealed a loss of over $9 billion in its revenue. The CEO, Tim Cook issued a letter which informs the same with a reason behind the cut in Apple Revenue Forecast. This letter was written to investors informing that the first quarter would be impacted by some specific issues.
Here’s The Reason Behind Cut In Apple Revenue Forecast
Apple declared 5 percent decline in its revenue for Q1 2019 when compared to that of 2018. The main reason behind is weakened demand. The shortfall in iPhone sales came primarily from China. Further, Cook also notices that “In some developed markets, iPhone upgrades also were not as strong as we thought they would be.”
The slowing down of transactions not only includes China but also Taiwan and Hong Kong markets. The trade tensions between the US and China is also a reason of economic slowdown in China which is an issue.
In the letter, Tim Cook indicates the decrease in the expected number of people traded in their older iPhones for new ones, specifically the iPhone XS, iPhone XS Max, and iPhone XR. Moreover, He also noted that iPhone upgrades were “not as strong as we thought they would be”.
But the core reason remains the same that people aren’t buying as many new iPhones as Apple hoped.
Why will iPhone users buy the new phone when they are getting cheap battery replacements. Earlier, Apple was charging $79 for battery replacement. But last year as compensation for degrading batteries it offered $29 for the same. This is the major reason why people prefer to replace the battery than to buy a new iPhone.
For now, these are the details for Apple Revenue Forecast. The brand would no longer disclose how many units of iPhones, iPads, and Macs it had sold, as announced last year. So you should not expect the real numbers coming up.
Towards the end of the letter, Cook seemed to reassure the investors by saying, “Apple innovates like no other company on earth, and we are not taking our foot off the gas. We can’t change macroeconomic conditions, but we are undertaking and accelerating other initiatives to improve our results.”
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