“While Apple anticipated some challenges in key emerging markets, it did not foresee the magnitude of the economic deceleration, particularly in Greater China,” said Tim Cook while amending Apple’s revenue forecast.

Cook says China’s economy started to weaken in H2 2018. The government-reported GDP growth during the September quarter was the second lowest in the last 25 years.

“Apple believes the economic environment in China has been further impacted by rising trade tensions with the US,” said Cook, “as the climate of mounting uncertainty weighed on financial markets, the effects appeared to reach consumers as well, with traffic to retail stores and channel partners in China declining as the quarter progressed. And market data has shown that the contraction in Greater China’s smartphone market has been particularly sharp.”

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Lower than anticipated iPhone revenues, primarily in Greater China, accounts for all of the company’s revenue shortfall to its guidance and for much more than its entire on-year revenue decline, said Cook.