Coronavirus: Apple warns of iPhone shortage because of deadly virus

Phil Thomas
Employees at an Apple store in Beijing wearing masks to prevent the spread of the deadly coronavirus: AP

Apple says it will not hit its quarterly earnings target after the coronavirus outbreak led to a cut in production of iPhones and a fall in demand in China.

The company, based in California, said all of its production plants in China had reopened but were only gradually returning to full production. None of its iPhone plants are in Hubei province, the centre of the deadly virus outbreak.

Apple had said in late January that it expected its second-quarter earning to be between $63bn and $67bn.

In a statement the company said: "Our quarterly guidance issued on January 28, 2020 reflected the best information available at the time as well as our best estimates about the pace of return to work following the end of the extended Chinese New Year holiday on February 10.

"Work is starting to resume around the country, but we are experiencing a slower return to normal conditions than we had anticipated. As a result, we do not expect to meet the revenue guidance we provided for the March quarter."

It said that "worldwide iPhone supply will be temporarily constrained", adding that "these iPhone supply shortages will temporarily affect revenues worldwide".

It said the problem was compounded by a drop in demand in China. Apple's second quarter ends on 30 March.

Meanwhile, more than 300 Americans who were stuck on a cruise ship affected by the coronavirus were back in the United States after being flown to US military bases for two weeks of quarantine after spending the previous 14 days docked in Japan.

Among those repatriated on two chartered jets were 14 people who tested positive for the virus, seven on each plane. The Diamond Princess cruise ship held the largest cluster of cases outside China, with more than 400 people infected out of some 3,700 on board.

The coronavirus outbreak has killed 1,770 people in China and five elsewhere, with Chinese officials reporting another 2,048 cases on Monday, raising the total to 70,548.

Hundreds of Americans had already been flown to military bases in the US from China to military bases in the United States. Arrangements were made to bring back the 338 cruise ship passengers once their 14-day quarantines on board had expired.

Another 60 Americans remained in Japan for monitoring, State Department officials said.

A further 200 US citizens are stuck in Cambodia, among them 92 still on board another cruise ship, the Westerdam, that was also affected by the virus.

The Diamond Princess was ordered to stay under quarantine at Yokohama port on 3 February after an 80-year-old Hong Kong man who had been on board developed the virus.

US officials previously pledged to keep infected Americans in Japan for treatment. But they said they were forced to change plans after the passengers disembarked and were on their way to the airport when Japanese officials informed them that 14 of those in transit had tested positive.

Reuters contributed to this report

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