Several Wall Street analysts have been cutting their iPhone production forecasts in the last few weeks amid reports of lackluster demand for the latest models.
In November, Apple also said it would no longer break out iPhone sales.
Then came Wednesday’s announcement, when the California-based iPhone maker lowered guidance for fiscal first quarter revenue and gross margin, hit primarily by “economic deceleration” in Greater China. The stock, which has already plunged more than 35 percent from a record high it reached this fall, dropped more than 7 percent in after-hours trading.
“We believe the economic environment in China has been further impacted by rising trade tensions with the United States,” Cook said in a letter to investors.
“As the climate of mounting uncertainty weighed on financial markets, the effects appeared to reach consumers as well, with traffic to our retail stores and our channel partners in China declining as the quarter progressed,” he said. “And market data has shown that the contraction in Greater China’s smartphone market has been particularly sharp.”
Chinese consumers have been holding back on spending due to uncertainty about the domestic economy, but analysts say trade tensions are just one of many other factors affecting growth.