Why is Apple so vulnerable to a trade war with China?

  • Apple closes down almost 6% on Monday after news of a major escalation in the U.S.-China trade war.
  • The company assembles iPhones in China, making it vulnerable to price increases if a tariff were to be placed on Chinese exports.
  • It also sells a lot of iPhones in China, making it sensitive to Chinese consumer confidence.
GP: Tim Cook China Development Forum 2019 In Beijing
CEO of Apple Tim Cook attends China Development Forum 2019 at the Diaoyutai State Guesthouse on March 23, 2019 in Beijing, China.
VCG | Getty Images

Apple closed down nearly 6% on Monday after news of a major escalation in the U.S.-China trade war.China said on Monday that it decided to raise tariffs on some U.S. goods after President Donald Trump threatened to further raise tariffs on Chinese imports last week.

The trade war is affecting a lot of different stocks, but Apple seems to be hit harder than most. The Dow Jones Industrial index dropped 2.6%, and the Nasdaq Composite dropped 3.5%.Apple is especially vulnerable to a trade war with China for two primary reasons.First, it assembles its iPhones primarily in China. Although it has a lot of American suppliers — it spent $60 billion on American suppliers in 2018 — iPhone assembly is done in mainland China.Whenever new tariffs are announced, investors must keep an eye on the details because it’s possible that some of Apple’s products could get caught in the crossfire.Morgan Stanley analyst Katy Huberty estimates that a 25% tariff on the iPhone could lead to a price increase of $160 for the iPhone XS. Or Apple could eat the tax, which could lead to a 23% decrease in earnings per share in 2020.

“Apple has one of the most significant exposures to Chinese exports to the US in our IT Hardware coverage group, given final assembly for many of its consumer electronic devices is located in China,” Huberty wrote in a note last week.“And given the reliance on China’s established, low-cost labor force and expertise in manufacturing/tooling, a large-scale move out of the country would not only be costly, but could take multiple years to complete, potentially raising the odds of execution risk, in our view,” the note continued.Last fall, a draft list of one of Trump’s round of China tariffs would have affected the Apple Watch and Apple AirPods, for example, although the final list did not affect Apple’s products.The other reason is that Apple, unlike other big tech companies, makes a substantial amount of its money by selling its products to Chinese consumers.Apple reported $51 billion in revenue in 2018 from “Greater China,” which includes Hong Kong and Taiwan. That’s Apple’s third-biggest region, after the Americas and Europe. Apple’s total revenue for the year was $265.6 billion.When Apple said earlier this year that its holiday quarter revenue would be significantly less than it had previously said to expect, it blamed a bad economic climate in China.“It’s clear that the economy began to slow there for the second half and what I believe to be the case is the trade tensions between the United States and China put additional pressure on their economy,” Apple CEO Tim Cook said in an interview with CNBC in January.“One of the reasons Apple CEO cited for China improvement was increased consumer confidence due to easing of US-China trade tensions,” UBS analyst Timothy Arcuri wrote in a note last week.“However, in recent days, trade tensions have escalated and it bears watching whether this affects China consumer sentiment,” the note continued.Apple has consistently opposed Trump’s proposed tariffs, and Cook has personally told Trump that Apple does not support implementing taxes on imports from China.Apple stock is up 24.9% since Jan. 1.
CEO of Apple Tim Cook attends China Development Forum 2019 at the Diaoyutai State Guesthouse on March 23, 2019 in Beijing, China.
VCG | Getty Images

Apple closed down nearly 6% on Monday after news of a major escalation in the U.S.-China trade war.China said on Monday that it decided to raise tariffs on some U.S. goods after President Donald Trump threatened to further raise tariffs on Chinese imports last week.

The trade war is affecting a lot of different stocks, but Apple seems to be hit harder than most. The Dow Jones Industrial index dropped 2.6%, and the Nasdaq Composite dropped 3.5%.Apple is especially vulnerable to a trade war with China for two primary reasons.First, it assembles its iPhones primarily in China. Although it has a lot of American suppliers — it spent $60 billion on American suppliers in 2018 — iPhone assembly is done in mainland China.Whenever new tariffs are announced, investors must keep an eye on the details because it’s possible that some of Apple’s products could get caught in the crossfire.Morgan Stanley analyst Katy Huberty estimates that a 25% tariff on the iPhone could lead to a price increase of $160 for the iPhone XS. Or Apple could eat the tax, which could lead to a 23% decrease in earnings per share in 2020.

“Apple has one of the most significant exposures to Chinese exports to the US in our IT Hardware coverage group, given final assembly for many of its consumer electronic devices is located in China,” Huberty wrote in a note last week.“And given the reliance on China’s established, low-cost labor force and expertise in manufacturing/tooling, a large-scale move out of the country would not only be costly, but could take multiple years to complete, potentially raising the odds of execution risk, in our view,” the note continued.Last fall, a draft list of one of Trump’s round of China tariffs would have affected the Apple Watch and Apple AirPods, for example, although the final list did not affect Apple’s products.The other reason is that Apple, unlike other big tech companies, makes a substantial amount of its money by selling its products to Chinese consumers.Apple reported $51 billion in revenue in 2018 from “Greater China,” which includes Hong Kong and Taiwan. That’s Apple’s third-biggest region, after the Americas and Europe. Apple’s total revenue for the year was $265.6 billion.When Apple said earlier this year that its holiday quarter revenue would be significantly less than it had previously said to expect, it blamed a bad economic climate in China.“It’s clear that the economy began to slow there for the second half and what I believe to be the case is the trade tensions between the United States and China put additional pressure on their economy,” Apple CEO Tim Cook said in an interview with CNBC in January.“One of the reasons Apple CEO cited for China improvement was increased consumer confidence due to easing of US-China trade tensions,” UBS analyst Timothy Arcuri wrote in a note last week.“However, in recent days, trade tensions have escalated and it bears watching whether this affects China consumer sentiment,” the note continued.Apple has consistently opposed Trump’s proposed tariffs, and Cook has personally told Trump that Apple does not support implementing taxes on imports from China.Apple stock is up 24.9% since Jan. 1.
Apple closed down nearly 6% on Monday after news of a major escalation in the U.S.-China trade war.China said on Monday that it decided to raise tariffs on some U.S. goods after President Donald Trump threatened to further raise tariffs on Chinese imports last week.

The trade war is affecting a lot of different stocks, but Apple seems to be hit harder than most. The Dow Jones Industrial index dropped 2.6%, and the Nasdaq Composite dropped 3.5%.Apple is especially vulnerable to a trade war with China for two primary reasons.First, it assembles its iPhones primarily in China. Although it has a lot of American suppliers — it spent $60 billion on American suppliers in 2018 — iPhone assembly is done in mainland China.Whenever new tariffs are announced, investors must keep an eye on the details because it’s possible that some of Apple’s products could get caught in the crossfire.Morgan Stanley analyst Katy Huberty estimates that a 25% tariff on the iPhone could lead to a price increase of $160 for the iPhone XS. Or Apple could eat the tax, which could lead to a 23% decrease in earnings per share in 2020.

“Apple has one of the most significant exposures to Chinese exports to the US in our IT Hardware coverage group, given final assembly for many of its consumer electronic devices is located in China,” Huberty wrote in a note last week.“And given the reliance on China’s established, low-cost labor force and expertise in manufacturing/tooling, a large-scale move out of the country would not only be costly, but could take multiple years to complete, potentially raising the odds of execution risk, in our view,” the note continued.Last fall, a draft list of one of Trump’s round of China tariffs would have affected the Apple Watch and Apple AirPods, for example, although the final list did not affect Apple’s products.The other reason is that Apple, unlike other big tech companies, makes a substantial amount of its money by selling its products to Chinese consumers.Apple reported $51 billion in revenue in 2018 from “Greater China,” which includes Hong Kong and Taiwan. That’s Apple’s third-biggest region, after the Americas and Europe. Apple’s total revenue for the year was $265.6 billion.When Apple said earlier this year that its holiday quarter revenue would be significantly less than it had previously said to expect, it blamed a bad economic climate in China.“It’s clear that the economy began to slow there for the second half and what I believe to be the case is the trade tensions between the United States and China put additional pressure on their economy,” Apple CEO Tim Cook said in an interview with CNBC in January.“One of the reasons Apple CEO cited for China improvement was increased consumer confidence due to easing of US-China trade tensions,” UBS analyst Timothy Arcuri wrote in a note last week.“However, in recent days, trade tensions have escalated and it bears watching whether this affects China consumer sentiment,” the note continued.Apple has consistently opposed Trump’s proposed tariffs, and Cook has personally told Trump that Apple does not support implementing taxes on imports from China.Apple stock is up 24.9% since Jan. 1.

https://www.cnbc.com/2019/05/13/why-is-apple-so-vulnerable-to-a-trade-war-with-china.html

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Murdoch’s News Corp calls for Google breakup

Rupert Murdoch’s News Corp has called for Google to be broken up in Australia, the latest salvo in a battle between the corporate media giants.

In a petition to Australian regulators, News Corp’s local subsidiary complained that “Google enjoys overwhelming market power in both online search and ad tech services.”

Going a step further, the company accused Google of “abusing its to the detriment of consumers, advertisers and publishers.”

Earlier this week US presidential hopeful—and former federal consumer watchdog—Elizabeth Warren became the latest in a line of commentators to argue that firms such as Amazon, Google and Facebook hold “ too much power” in society.

News Corp echoed her argument that Google’s businesses should be split, or failing that, search and advertising businesses should be firewalled off from each other.

“While News Corp Australia recognises that divestment is a very serious step … divestment is necessary in the case of Google, due to the unparalleled power that it currently exerts over news publishers and advertisers alike.”

Australian watchdogs are seen as unlikely to recommend that Google be split, but the petition represents an intensification of the worldwide fight between Australian-born Murdoch and Google and Facebook.

News organisations accuse the tech giants of gaining huge commercial benefit from expensive to create content, while paying nothing and syphoning off advertising.

The Australian Competition and Consumer Commission is one of several regulators across the world investigating the effect that have on competition in the media, advertising and advertising services markets.

News organisations in Australia have struggled in recent years with falling revenue and shrinking staff, as giants like Google and Facebook dominate the digital economy.

The downturn has prompted a string of mergers that have left the market with only three or four major media companies.

Local newspapers, once the lifeblood of communities across this vast country, run on a skeletal staff or have been forced to close.

Among them Murdoch’s News Corp is a dominant player, owning a slew of newspapers, television channels and the country’s only major cable television network.

Murdoch’s vast political influence has frequently come underfire from former prime ministers on both sides of Australian politics and is widely seen as pushing the tone of public debate to the right.

News Corp Australia is a subsidiary of News Corp, which owns 21st Century Fox, the Wall Street Journal, Fox News, and a raft of papers and TV platforms in Britain.

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://phys.org/news/2019-03-murdoch-news-corp-google-breakup.html

Labor Market Crisis: Wages Not Rising With Inflation

As we reported last week, a record 7 million Americans have fallen 90 days or more behind on their auto loan payments.

That’s 1 million more than the previous peak in auto loan delinquencies in 2010. But as Wolf Street points out, there is a big difference between then and now.

“Serious auto-loan delinquencies are now on par with Q2 2009 when millions of people had lost their jobs and when the economy was in free-fall. But today unemployment is low and the economy appears to be humming. What gives? “

Currently, there is about $1.3 trillion in auto loans outstanding. Looking at auto loan delinquencies in terms of a percentage of the total outstanding, the number hit 4.5% at the end of 2018. This is the same percentage as in the second quarter of 2009 as the economy was feeling the full effect of the 2008 crash.

Wolf Richter of Wolf Street highlighted some of the reasons for the surge in auto loan delinquencies in a recent episode of the Wolf Street Report.

In the first place, a lot of Americans are struggling with their jobs.

“While the unemployment rate is at around 4% and has been as low as 3.7%, there are many pockets of weakness in the labor market. A lot of people have gig work. A lot of people are underpaid. Their wages have not gone up with inflation. People have been discouraged and they’re not participating in the labor force anymore, and so they don’t show up in unemployment figures. So, there are many weaknesses in this labor market.”

Even so, Richter said it’s still the “cleanest dirty shirt of the labor market” we’ve had in a number of years, so the labor market itself cannot completely explain the surge in auto loan delinquencies.

A second issue is the rapidly rising cost of new cars. The average price of a new vehicle is now around $36,000. This represents a significant increase in the cost of vehicles and there has not been a corresponding rise in wages. Subprime borrowers face a double whammy. They not only have to pay the higher price; they also get hit with a higher interest rate.

A third, and according to Richter probably the most significant issue, is the number of subprime lenders who have plowed into the auto business over the last 10 years. This is an extremely profitable business for the lender, but an extremely risky position for the borrower.

“These are precisely the kind of customers who can’t afford those payments, and cannot afford to make those payments based on high-interest rates, and they can’t even afford that expensive of a car.”

The auto business actually looks a lot like the subprime housing market we saw blow up in the years leading up to the 2008 crash. These companies make risky loans. They use sloppy underwriting techniques. And then they package the loans together in auto loan-backed securities and sell them.

By 2018, the air was coming out of the auto bubble. A number of these specialized subprime auto lenders had already collapsed. Richter said now we’re starting to see many of these companies curtail their lending.

Of course, it’s not just specialized companies making subprime loans. According to Richter, about 25% of the auto loans on the books of big banks are subprime. Credit unions have also gotten into the business.

The big difference between the subprime auto loan market today and the subprime housing market in the years before the crash is one of scale. A collapse in the subprime auto market will cause some pain, but it won’t likely bring down financial institutions.

(Photo by Mussi Katz, Flickr, Public Domain)

But that doesn’t mean this isn’t extremely problematic. The real question is how will the looming credit crunch affect the auto industry – an important part of the US economy? Richter says we’re already seeing the impact.

In 2015 and 2016, US automakers experienced record years. Since then, we’ve seen a downturn. As default ratios spike, lenders become more careful and that squeezed more and more potential customers out of the market.

“As auto-loan delinquencies continue to surge, as those losses are spreading, underwriting will continue to tighten and will make it more difficult for an entire layer of customers to buy new vehicles.”

And this is the rosy scenario. The real question is what happens if the economy goes into recession? What happens if we see growing job losses?

This gives us a glimpse of the underlying rot in the US economy. The Federal Reserve flooded the country with easy money. That blew up all kinds of bubbles, including the auto lone bubble. The simple truth is economies built on debt aren’t sustainable.

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://www.infowars.com/labor-market-crisis-wages-not-rising-with-inflation/

Dow jumps over 450 points, clinches 8th straight weekly gain

Stocks surged on Friday amid increasing hopes for a U.S.-China trade deal as equities posted another solid weekly gain.

The Dow Jones Industrial Average jumped 443.86 points to 25,883.25 as J.P. Morgan Chase and Goldman Sachs outperformed. The S&P 500 gained 1.1 percent to close at 2,775.60, led by the energy and industrials sectors. The Nasdaq Composite advanced 0.6 percent to end the day at 7,472.41.

Energy shares were boosted by higher oil prices. West Texas Intermediate futures rose 2.2 percent to $55.59 per barrel.

Bank stocks also rose broadly. The SPDR S&P Bank ETF (KBE) climbed 2.25 percent. Goldman Sachs, Morgan Stanley, J.P. Morgan Chase, Citigroup and Bank of America each advanced 2.54 percent or more.

The 30-stock Dow’s eight-week winning streak is its longest since the one ending Nov. 3, 2017. The Nasdaq also posted its eighth consecutive weekly gain. The S&P 500, meanwhile, closed its seventh weekly gain in eight. The indexes rose at least 2.4 percent each this week.

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://www.cnbc.com/2019/02/15/stocks-trump-speech-us-china-trade-and-earnings-in-focus.html

Labor Unions Fear ‘Green New Deal’ a Job Killer

Labor unions say they are withholding support for a Green New Deal unveiled by Democrats last week to transition the American economy away from fossil fuels, arguing the loosely-defined plan could kill jobs if its architects aren’t careful.

The cool response from unions underscores the challenge facing Democratic presidential hopefuls who support aggressive action on climate change but must also win back the blue-collar voters that swept President Donald Trump to victory in 2016.

Erik McGregor/Pacific Press/LightRocket via Getty Images

The Green New Deal is a non-binding Congressional resolution introduced by Representative Alexandria Ocasio-Cortez and Senator Edward Markey that would legislate government-led investment in clean energy infrastructure with the goal of making America carbon neutral within a decade.

Read more

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://www.infowars.com/labor-unions-fear-green-new-deal-a-job-killer/

Cryptocurrency investors locked out of $190m after exchange founder dies

About $190m in cryptocurrency has been locked away in a online black hole after the founder of a currency exchange died, apparently taking his encrypted access to their money with him.

Investors in QuadrigaCX, Canada’s largest cryptocurrency exchange, were unable to access their funds after its founder, Gerald Cotten, died last year.

According to a court filing first reported by CoinDesk, a cryptocurrency news and events company, Jennifer Robertson, identified as Cotten’s widow, said the exchange owes its customers roughly C$250m (US$190m) in cash and cryptocurrency held in its “cold storage”.

“Quadriga’s inventory of cryptocurrency has become unavailable and some of it may be lost,” Robertson wrote in the filing.

Cotten, 30, died in India last December from complications from Crohn’s disease, according to the company. He was in India “opening an orphanage to provide a home and safe refuge for children in need”.

The news followed a decision by Canadian Imperial Bank of Commerce (CIBC) to freeze $28m of assets held by Quadriga after saying it was unable to identify the real owners of the funds.

Robertson was not involved in the business. In the filing she noted that there had been a “significant amount of commentary on Reddit and other web based platforms about Quadriga, Gerry’s death (including whether he is really dead) and missing coins”. She said she had also received threats and slanderous comments.

Robertson has access to Cotten’s laptop but writes that she is unable to open it. “The laptop computer from which Gerry carried out the companies’ business is encrypted and I do not know the password or recovery key. Despite repeated and diligent searches, I have not been able to find them written down anywhere.”

Robertson has retained an expert to try to access the funds but he has so far not been able to do so.

The platform continued to accept funds after Cotten’s death but was paused by directors on 26 January.

On 31 January, QuadrigaCX filed an application for creditor protection with the supreme court of Nova Scotia, after months of transaction delays.

At a court hearing on 5 February the company is seeking to appoint Ernst & Young as an independent monitor.

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://www.theguardian.com/technology/2019/feb/04/quadrigacx-canada-cryptocurrency-exchange-locked-gerald-cotten

Hispanic Unemployment Rate Hits Record Low in December

The national seasonally-adjusted unemployment rate for Hispanics and Latinos in the U.S. labor force hit its lowest level on record in December of 2018, U.S. Bureau of Labor Statistics (BLS) datareleased Friday show.

In December, the unemployment rate for Hispanics and Latinos, aged 16 and up, was 4.4%, down from 4.5% in November – tying its record low of 4.4% set in October of this year. BLS began tracking Hispanic-Latino employment data in 1973.

The number of Hispanics employed set a new record high of 27,701,000 in December, as their unemployment rate fell to a record low. The number of Hispanics employed, participating in the workplace, and civilian population all rose in December, as Hispanics’ labor force participation rate increased from 66.8% to 67.0%, recording its fourth straight monthly increase.

Hispanic-Latino employment statistics for December 2018:

· Unemployment rate: 4.4%, down from 4.5% in November

· Civilian Noninstitutionalized Population (16+ years old): 43,234,000 up from 43,146,000 in November

· Number Participating in Labor Force: 29,963,000, up from 28,820,000 in November

· Labor Force Participation: 67.0%, up from 66.8% in November

· Number Employed: 27,701,000, up from 27,524,000 in November

· Number Unemployed: 1,261,000, down from 1,296,000 in November

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://www.cnsnews.com/blog/craig-bannister/hispanic-unemployment-rate-hits-record-low-december

Manufacturing posts best calendar year for job gains since 1997

The manufacturing industry posted net job gains of 284,000 over 2018, capping its best calendar year since 1997.

A priority for President Donald Trump, manufacturing saw marked hiring in December with an additional 32,000 jobs. Most of the gains occurred in blue-collar durable goods manufacturing, with growth in fabricated metals and computer and electronic products, the Labor Department said in its release. The definition of durable goods is items with a life expectancy of three years or more, such as automobiles, furniture and machinery.

Manufacturing added 207,000 jobs in 2017.


“Manufacturers are bringing people back into the workforce, and we need this trend to continue,” said Dr. Chad Moutray, chief economist at the National Association of Manufacturers. “Our industry currently faces a workforce crisis with more than half a million open jobs today, and 2.4 million jobs expected to go unfilled over the next decade. Closing the skills gap continues to be the top challenge facing manufacturers in the United States and is absolutely essential to ensuring that the sector continues to grow.”

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://www.cnbc.com/2019/01/04/manufacturing-posts-best-calendar-year-for-job-gains-since-1997.html

US employers went on a surprising hiring spree in December

U.S. employers went on a hiring spree in December, adding a surprising 312,000 jobs and providing a dose of reassurance about the economy after a turbulent few months on Wall Street.

The job gains reported Friday by the Labor Department came despite a trade war with China, a global slowdown and a partial government shutdown now entering its third week.

The nation’s unemployment rate rose slightly to 3.9 percent last month, but that, too, was considered a positive sign, reflecting an increase in Americans beginning to look for work. And average hourly pay improved 3.2 percent from a year ago.

Stocks surged on the news, along with word that the U.S. and China will hold trade talks next week and comments from Federal Reserve Chairman Jerome Powell that the Fed will be flexible in judging whether to raise interest rates further. The Dow Jones industrial average shot up 747 points, or 3.3 percent.

President Donald Trump called the job growth “GREAT” on Twitter.

The torrid hiring in December far outstripped the 180,000 jobs investors had been anticipating and could help ease fears that the economy’s expansion — now in the middle of its 10th year — may be coming to an end.

“The labor market is very strong even though the economy appears to be slowing,” said Eric Winograd, senior U.S. economist at the investment management firm AllianceBernstein. “Those two things cannot coexist for very long. Either weakening demand will lead firms to dial back the pace of hiring or the robust pace of hiring will lead firms to ramp back up production.”

In recent weeks, financial markets have plunged amid concerns that the U.S. could be in a recession by 2020. The Dow suffered its worst December since the middle of the Depression in 1931.

Major companies such as Apple say their sales are being jeopardized by the tariff war between Washington and Beijing, and an important gauge of U.S. manufacturing posted its steepest decline in a decade Thursday.

China, the world’s second-largest economy, is also mired in a slowdown, its consumers losing much of their appetite for real estate, iPhones, Ford vehicles and jewelry from Tiffany & Co.

The U.S. government shutdown and Trump’s attacks on the Fed and its chairman over the central bank’s rate increases have also worried investors, though Powell may have eased some of those concerns Friday when he stressed that he would not resign if the president told him to do so.

The strong job growth suggests employers believe U.S. consumer spending will stay robust.

Health care and education added 82,000 jobs last month, the largest jump in nearly nine years. Restaurants and drinking places posted a net gain of 40,700 jobs. Builders added 38,000 construction jobs, while manufacturers increased their payrolls by 32,000 workers.

Businesses are still searching for more workers.

Fresh Coat Painters, based in Cincinnati, plans to nearly double the 300 employees who paint homes and businesses as it expands this year across this country. The franchiser is also launching an apprenticeship program to attract workers, in addition to providing higher pay and benefits.

Tara Riley, president of Fresh Coat, said that franchise owners are having to actively search for workers instead of simply posting ads.

“We realized it was a mindset change: You have to be recruiting, rather than hiring,” Riley said.

Still, Kevin Hassett, chairman of the White House Council of Economic Advisers, cautioned on Thursday that the jobs report for January could be weak if the shutdown continues. Job totals could be lowered by hundreds of thousands of government employees being temporarily put out of work.

“So when we see the January jobs number, it could be a big negative,” Hassett said.

In 2018, employers added 2.6 million jobs, or an average of nearly 220,000 a month, according to the Labor Department.

At some point, even if the economy remains healthy, monthly job gains will likely downshift to a more gradual pace. This is because there is a dwindling pool of unemployed people. There were 6.3 million people looking for a job in December, down from 6.5 million a year ago.

“People should not get used to numbers like the one we saw this month,” said Martha Gimbel, director of economic research at the jobs site Indeed. “Eventually, job growth is going to start slowing down. When that happens, we shouldn’t panic.”

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://apnews.com/f3925762c6f845dfab936b45c28b4176

Apple Makes Rare Cut to Sales Guidance

Apple Inc. AAPL 0.11% slashed its quarterly revenue forecast for the first time in more than 15 years, an unprecedented move in the Tim Cook era that was prompted by a downturn in sales of iPhones in China.

The surprise cut, issued Wednesday in a letter from the chief executive to investors, renews concerns about waning demand for Apple’s marquee product, the iPhone, which makes up the vast share of its revenue and has vaulted the company’s value and profits. It also raises fresh questions about Apple’s prospects in China, the world’s largest smartphone market, which represents nearly 20% of Apple’s sales.

FOLLOW THE LINK FOR THE FULL REPORT – JR

https://www.wsj.com/articles/apple-revises-guidance-sees-lower-revenue-in-fiscal-1st-quarter-11546465050