Apple says it won’t meet its quarterly revenue guidance because of the coronavirus crisis
U.S. stocks index futures were sharply lower on Tuesday after Apple (NASDAQ: AAPL) announced that it would not be able to meet its revenue target this quarter because of lower iPhone demand in China and subdued production amid the COVID-19 coronavirus epidemic.
In a statement to investors on Monday, the tech giant said that worldwide iPhone supply will be temporarily constrained due to the coronavirus epidemic and that factories run by its suppliers in China were resuming work more slowly than expected.
The deadly coronavirus continues to grip China, particularly in the city of Wuhan and the province of Hubei. As of Tuesday morning, the disease had infected 72,436 people and killed 1,868 in mainland China, according the country’s health officials.
The blue-chip Dow futures were down 167.5 points, or about 0.57% to 29,227.5. The S&P 500 futures dropped 18.12 points, or around 0.54% to 3,362.88 while the tech-heavy Nasdaq 100 futures declined 88.13 points, or roughly 0.91% to 9,544.12.
Apple shares were down $11.95, or 3.68% to $313.00 apiece in pre-market hours Tuesday.
China to exempt tariffs on more U.S. goods
Meanwhile, Reuters is reporting that China will accept applications from March 2 for new tariff exemptions for nearly 700 products imported from the U.S. including soybeans, beef, pork, crude oil and liquefied natural gas.
According to China’s Customs Tariff Commission of the State Council, imports of U.S. medical equipment including instruments to measure blood pressure, patient monitors, and blood transfusion devices also have a chance to be exempted from the additional tariffs, as Beijing battles to contain the coronavirus outbreak.
The exemptions come a month after the U.S. and China signed a phase-one deal, marking a cooling of their months-long trade war that upset supply chains and roiled global markets.
Under the deal, China agreed to increase its purchases of U.S. goods and services by $200 billion over two years.
Walmart misses fourth-quarter earnings and revenue expectations
Walmart (NYSE: WMT) released weaker-than-expected fiscal fourth-quarter results before the bell today, citing disappointing store traffic and civil unrest in China.
The Bentonville-based retailer had adjusted earnings of $1.38 per share and revenue of $141.67 billion in the holiday quarter. On average, analysts surveyed by Thomson Reuters expected the retailer to post earnings of $1.43 per share on revenue of $142.5 billion for the quarter.
Walmart said disruptions due political unrest that erupted in Chile late last year impacted its operating income by nearly $110 million. Same-store sales, a closely-watched metric, grew 1.9% in the U.S., missing analyst estimates of a 2.3% rise.
“We started and finished the quarter with momentum, while sales leading up to Christmas in our U.S. stores were a little softer than expected,” said Walmart CEO Doug McMillon in the company’s earnings statement.
For fiscal 2021, the company expects earnings of $5 to $5.15 per share, below analyst forecasts of $5.21. Walmart stock declined 0.33% to $117.50 a share in pre-market trade.