News Ticker

It Starts: Apple Throws Revenue Guidance Out the Window, on Supply Chain Woes & Sales Collapse in China

A near-empty park in Wuhan, China, on Monday, Jan. 27. 2020, as the city remained on lockdown. PHOTO: The New York Times/Getty

This will become an often-played tune over the next few months, delineating how dependent Corporate America has become on China.

By Wolf Richter | 17 February 2020

WOLF STREET — China’s official reaction to the coronavirus – locking down mega-cities, shutting down part of the transportation system, closing factories and retail stores for weeks, etc. – largely shut down production and crushed retail sales. And this predictably would do two things to Corporate America:

  • Throw its complex and huge supply chains that crisscross China into disarray,
  • And cause sales in China of US brands – mostly made in China – to collapse.

There have already been some US companies that grappled publicly with warnings about revenues, earnings, and supply chain woes. But here is the big one.

Apple announced this afternoon – a holiday for US markets and the last day of a long weekend, when no one is paying attention – that it threw its revenue guidance of January 28 out the window. Clearly, January 28 was not the time to sow doubt; the stock had to be driven higher. […]

Be the first to comment

Post a Comment

Winter Watch
%d bloggers like this: