Apple’s problems caused the Dow Jones Industrial Average to fall. The technology giant's management lowered its quarterly sales forecasts for the first time in almost 20 years. The revenue guidance for the first quarter, which ended on December 29, was reduced from $89-93 billion to $84 billion. The company also lowered its gross margin expectations from 38.5 percent to 38 percent, while analysts expected figures to exceed Apple's estimate by about 12%. Such a serious difference in the forecasts had an immediate effect on the Dow Jones Industrial Average, which plunged by more than 600 points. "While we anticipated some changes in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in greater China... Services generated over $10.8 billion in revenue during the quarter, growing to a new quarterly record in every geographic segment, and we are on track to achieve our goal of doubling the size of this business from 2016 to 2020", Apple Chief Executive Tim Cook wrote in his letter to investors.
Among other factors for the lowered guidance, the company identified macroeconomic problems in the developing countries and the rising cost of products for buyers amid the strengthening of the dollar. In addition, sales of new models showed that the demand for the Apple products turned out to be significantly lower than expected. Overall, at the moment, there is almost no positive news for the markets. Investors are disappointed with Apple's estimates: the company's stock lost 7.6% in price during after-market trading on January 2. The technological giant’s stock price dropped by 31.1% over three months, after it hit record high and its capitalization exceeded $1 million.
