Apple loses $57 billion in market value as its stock plunges

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While this is still quite a large sum, the company expected to bring in revenue between $89 billion and $93 billion.

The stock's decline was accelerated following the release of CEO Tim Cook's letter to investors on Wednesday, where he announced the firm expects to miss first quarter revenue targets.

Apple dropped 10 percent, erasing $74.6 billion in value. "First, the different timing of its iPhone launches, which would affect its on-year compares". On New Year's Day the company reported more than $322 million was spent in NY setting a record as customers bought iPhones, iPads with apps, and used their App Store gift cards.

Apple predicts quarterly gross margin of 38% and operating expenses of $8.7 billion. In October, Apple shocked investors by saying it planned to stop disclosing the number of iPhones sold each quarter. The AirPods and the MacBook Air were also constrained. "This turned out to have a significantly greater impact than we had projected". "Apple is an enormous revenue and profit generator, and will remain so for years to come".

Cook states that the "magnitude of the economic deceleration" in Greater China took Apple by surprise, resulting in much of its revenue decline.

Cook said the iPhone "accounts for all of our revenue shortfall", whereas other products in Apple's lineup such as the Mac and iPad are seeing strong growth.

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"China's economy began to slow in the second half of 2018".

Meanwhile, Huawei and Oppo - two of Apple's competitors in Chinese markets - have reported higher valued market shares within the previous year. "It symbolizes how deep China's economic problems are, and we can connect the dots right back to the trade war". "So we saw as the quarter went on things like traffic in our retail stores, traffic in our channel partner stores, the reports of the smartphone industry contracting, particularly bad in November".

Stock trading was temporarily halted Wednesday while Apple lowered its guidance. In fact, categories outside of iPhone (Services, Mac, iPad, Wearables/Home/Accessories) combined to grow nearly 19% on-year.

Trump also seemed to blame Apple's revenue shortfall on the iPhone makers decision to manufacture their products in China.

The CEO said he still believed the region holds a "bright future" for Apple. Trump said that Apple is now building a new campus in U.S. because of "what we did with taxes and the incentives we created in the United States".

While President Trump's trade war with China isn't helping Apple and other U.S. technology companies, Mr Ives believes Apple miscalculated by continuing to roll out high-priced phones in China, creating an opening for rivals with less costly alternatives that still worked well.