Apple supplier Foxconn's revenue hammered by coronavirus fallout
Revenue was down 18% in February compared with a year earlier
TAIPEI (Reuters) - Apple's manufacturing partner Foxconn reported its biggest monthly drop in revenue in about seven years on Thursday as the coronavirus outbreak continued to play havoc with its business.
The Taiwanese company, which assembles Apple's iPhones, saw revenue sink 18.1% in February compared with a year earlier - the biggest monthly fall since March 2013 and the third straight month of decline. It warned the coronavirus epidemic would hit its bottom line in the first quarter.
Foxconn is among manufacturers worldwide grappling with virus-related curbs that have disrupted supply chains and dampened demand. Apple, its top client, rescinded its March quarter sales guidance, citing a slower ramp up of manufacturing in China amid travel restrictions and an extended Lunar New Year break.
CORONAVIRUS HAS APPLE WARNING STORES ABOUT A SHORTAGE OF REPLACEMENT IPHONES
Foxconn, formally known as Hon Hai Precision Industry Co Ltd, said in a stock exchange filing that revenue fell to T$217.5 billion ($7.28 billion) in February.
| Ticker | Security | Last | Change | Change % |
|---|---|---|---|---|
| AAPL | APPLE INC. | 237.33 | +2.40 | +1.02% |
The company, whose share price has dropped nearly 10% this year, warned earlier this week that revenue would fall more than 15% in businesses including consumer electronics and telecommunications products in the first quarter. But it added that revenue would recover thereafter as production returns to normal in virus-hit China.
EXCLUSIVE: APPLE CEO TIM COOK SAYS CHINA GETTING CORONAVIRUS UNDER CONTROL
The company said it did not expect to see any revenue growth in the first half and made a "mild downward revision" from its original guidance of "slight growth" for the year due to the coronavirus.
In this May 26, 2010 file photo, staff members work on the production line at the Foxconn complex in the southern Chinese city of Shenzhen, southern China. (Associated Press)
Foxconn has pledged to resume normal production in China, its top manufacturing base, by the end of March.
Any significant disruption at Foxconn would cloud Apple's timeline for new phones.
APPLE CO-FOUNDER STEVE WOZNIAK SAYS HE HAD CORONAVIRUS-LIKE SYMPTOMS BUT CDC GAVE HIM 'RUN-AROUND'
The flu-like virus, which originated in China, has spread to over 60 countries. There are now over 95,300 cases worldwide and more than 3,200 people have died, most of them in China, according to a Reuters tally.
GET FOX BUSINESS ON THE GO BY CLICKING HERE
($1 = 29.8620 Taiwan dollars)
CLICK HERE TO READ MORE ON FOX BUSINESS
(Reporting by Yimou Lee; Editing by Pravin Char)