Apple shares sink as iPhone sales figures slashed

Apple CEO Tim Cook

Apple's shares were briefly suspended on Wednesday night, and in post-market trading fell by up to 8pc, wiping nearly $60bn off its value. Even though Apples iPhone sales arent doing as well as previous years, it still shows promise in its ever-increasing revenue sources outside of the iPhone.

Cook cited China as Apple's biggest weak spot, but also said that consumers weren't upgrading to the latest iPhones models as eagerly as anticipated.

Fourth, we expected economic weakness in some emerging markets.

Apple is facing a rocky start to 2019, as it's published a letter from CEO Tim Cook to shareholders explaining that the company expects a $9 billion drop in revenue in the first quarter of 2019 (down from a high forecast of $93 billion to an updated figure of $84 billion).

In August, Apple became the first company worth $1 trillion.

China's economy started slowing down in the second half of 2018, and its September-quarter GDP was the second lowest in 25 years, Mr Cook wrote.

The rare earnings warning was significant enough that Apple stock was halted in after-hours trading, and when trading resumed 20 minutes later, it was down by over seven per cent. Apple said it has put more than 100 million new Apple devices into service over the past year.

Apple's boss also told investors he believes the company has a bright future in China - but the US-China trade war was a contributing factor to the weaker results. In the U.S. government bond market, a typical safe-haven, the yield on the benchmark 10- year, which moves inversely to the bond's price, sank to an 11-month low. With Apple suddenly launching several new products in the quarter-including iPhones, Apple Watches, and Macs-it experienced "supply constraints" that would "gate" (slow) sales of "certain products" during the quarter. Automakers such as Ford Motor Co, Hyundai Motor Co and Nissan Motor Co all previously said they planned to cut production in the country.

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So according to Cook, it's kind of China's fault that Apple isn't making quite as many buttloads of money as it expected, and it's also kind of Trump's fault.

In fessing up to the looming fiscal disappointment, the Apple boss blamed the shortfall not on the eye-wateringly high prices for its latest lines of kit, but rather on the people of China, who let Apple down by not purchasing as many shiny doodads as was expected of them.

iPhone sales have been sliding and Apple faces stiff competition in China.

The Dow Jones Industrial Average and other major USA stock indices closed in the green on Wednesday following another day of the sort of volatile trading that Allianz Chief Economic Advisor Mohamed El-Erian predicted will be the "new reality" for the stock market.

In a letter to investors on Wednesday, chief executive Tim Cook said the firm's miss was due primarily to China.

Apple was already fielding questions about demand for its next lineup of iPhones.

Apple's troubles may have ripple effects on other technology companies, given investors have been bailing on the industry in recent months.

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