Apple supplier Foxconn said that it is expecting to resume normal production by the end of March addressing investor concerns regarding the impact of the coronavirus outbreak, Reuters reported on Tuesday.
The Taiwanese firm, which assembles Apple’s iPhones warned that revenue was expected to drop almost 15 per cent in the first quarter for businesses working in consumer electronics and enterprise products segments. The income will recover gradually after that as production returns to normal in China, the epicentre of the outbreak, the report said.
Foxconn chairman Liu Young-Way in an online investor conference, said that the company’s topmost priority was the prevention of the outbreak apart from bringing back work and production on track, the report said. Liu further added that it would be able to cushion itself against the price hike for components owing to its “long-term cooperation” with suppliers.
If production does not resume to normal, it is bound to affect Apple’s deadlines for its new iPhones as the company’s supply chain has been majorly impacted due to virus-hit China.
The US-based tech-giant was already feeling the blow of the COVID-19 outbreak and had announced earlier this month that it would not be meeting its revenue forecast for March.
“Our quarterly guidance issued on January 28, 2020 reflected the best information available at the time as well as our best estimates about the pace of return to work following the end of the extended Chinese New Year holiday on February 10,” the company said in an official statement.
“Work is starting to resume around the country, but we are experiencing a slower return to normal conditions than we had anticipated. As a result, we do not expect to meet the revenue guidance we provided for the March quarter due to two main factors.”
The “two main factors” impacting the company’s revenue cited by Apple were the disruption in the supply chain as well as lack of demand in China.
“The first is that worldwide iPhone supply will be temporarily constrained,” it said.
“The second is that demand for our products within China has been affected,” it further added.
China had reported over 80,000 confirmed cases of the virus with over 2943 deaths on March 2.