Tuesday, 25 February 2020 08:27

Apple May Be at Risk of Sustained Downturn

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(San Francisco)

Apple’s stock has suffered significantly last week since it announced that it would likely miss its revenue targets because of the virus outbreak in China. The stock is down 7% since the announcement and there is increasing speculation the damage may not be transient. The whole incident calls into question whether the country is too reliant on China for production (and also for sales). Many Wall Street analysts have pushed lost revenue for this quarter into other quarters, but it is not at all inconceivable to think that some of the sales may be lost permanently as consumers could have bought rival products, or just won’t switch at all (especially those in China).


FINSUM: Apple should probably work to adjust its supply chain as a reaction to this, but that seems unlikely. Hard to tell how this plays out; it depends on the news cycle.

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