Yesterday, Apple issued a press release reviewing its financial results forecasts for the next fiscal quarter – all because of the overwhelming effects of the Coronavirus (or COVID-19, for scientists) in China. For, as expected, the Apple will not be the only one affected by the disaster.
According to the TrendForce, the smartphone industry as a whole will suffer from the outbreak, especially since the assembly of the devices still involves a good proportion of human activity (not robots) and is concentrated particularly in Chinese regions.
The firm’s estimates indicate that in the first quarter of 2020, smartphone production will fall 12% compared to the same period last year – with this, we will have the lowest volume of production of mobile devices in five years. Sales, therefore, will follow the trend and also show a significant drop.
According to TrendForce, shipments from iPhones will fall 10% in the quarter, which is certainly not good news for Apple. And it gets worse: in another report, the Nikkei Asian Review estimates that the impacts of the Coronavirus outbreak will affect the production of Apple smartphones by April. At the moment, according to the firm, Apple’s suppliers are operating between 30% and 50% of capacity, due to the virus.
Still in the words of Nikkei, COVID-19 may, yes, affect the production of the so-called “iPhone 9”:
“Suppliers are doing everything they can to produce and ship the [novo] iPhone within four weeks. The delay cannot be so great, because it could affect the sales strategy of Apple’s new products in the second half ”, said one of the people with direct knowledge of the subject.
The problem will not focus only on smartphones, however: according to TrendForce, the wearable will suffer a retraction of 16% compared to the original estimates for the period. That is, the effects are really remarkable.
Advantage for Samsung?
Amidst the whole scenario of uncertainty, who can take advantage – according to the Reuters – and the Samsung. Currently, almost half of the South Korean’s smartphones are manufactured in Vietnam, where the effects of the Coronavirus are not felt even close to how they hit China. In addition, the Wall Country has historically not been one of the biggest selling points of Sammy.
While Apple expects a 10% drop in the quarter, Samsung is expected to drop only 3%. Furthermore, it is worth remembering, the South Korean recently announced its flagships for 2020, which will cause your sales to accelerate in the coming months.
Anyway, if the effects of Coronavirus remain for longer, Samsung will also be affected – after all, several of the components of the company’s smartphones come from China, anyway. Let’s follow up on the case.