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China lockdowns take their toll on Apple as earnings fall short of forecasts for the first time in seven years
Apple’s profits have not been forecast for the first time in seven years as iPhone sales were hit by China’s lockdowns.
Sales fell 5 percent to £96 billion in the three months to the end of December. Profits, meanwhile, fell from £28bn in the same period in 2021 to just under £25bn.
The numbers followed a difficult time for Apple as it suffered production stoppages at factories in China due to ever-changing Covid restrictions.
In the run-up to Christmas, it faced significant disruptions from lockdowns and worker protests at manufacturer Foxconn’s factory in Zhengzhou.
The factory, which employs 200,000 workers, produces most of Apple’s iPhone 14 Pro and iPhone 14 Pro Max handsets.
Setback: Apple, led by boss Tim Cook (pictured), saw sales fall 5% to £96bn in the three months to the end of December
Apple said in November production problems would mean iPhone shipments would be lower than expected.
Before last night’s results, Apple’s stock was up 20 percent this year, after a 30 percent slump in 2022.
The company was rocked by the broader tech sell-off as the Federal Reserve hiked US interest rates and the global economy teetered on the brink of recession.
It has also been the subject of speculation about how long it can outperform the market, as cost of living and inflation impact consumer purchasing power and keep its expensive electronics out of reach for many customers.