But analyst Timothy Arcuri expects Apple’s “demand impact” to spread—like a virus—beyond China.
From a note to clients that landed on my desktop Friday:
We think the risk of lower demand in the near-term is increasing and we lower our Jun. quarter forecasts. We had moved some demand from March into June but given the broader impact, we now think the demand impact could continue into Jun. We keep our Mar. quarter estimate unchanged, which is 6% lower than Apple’s original guide and likely reasonable assuming 15-20% demand deterioration in China (anecdotal expectations) equating to 3-4% for overall Apple. We expect China demand to remain weak as the return to normalcy and confidence takes time and we expect the monthly smartphone data to be weaker in Feb and Mar compared to 28% YoY decline in Jan.
My take: Seems like the situation has to get worse before we can see a “return to normalcy.”
See also: The Apple 3.0 COVID-19 archives
As the world takes an abundance of caution w.r.t. Covid-19, the economy and then valuation assumptions become impacted. The caution is a good thing, at least for now, as new hot spots keep appearing.
BBC Tech today reported “ One billion Android devices at risk of hacking”.