- The ongoing coronavirus outbreak was not a major talking point during Apple’s annual shareholder meeting, despite the fact that it prompted the company to revise its March quarter revenue guidance earlier this month.
- Apple CEO Tim Cook briefly touched on the outbreak, calling it a “fairly dynamic situation” that has posed “a challenge” for the tech giant.
- Although the coronavirus wasn’t a major talking point during the meeting, some advocates of shareholder proposals did bring it up in their talking points.
- The ongoing spread of the virus has made it difficult make predictions about Apple’s performance and the status of its future products. For example, the company did not provide a new estimate when it revised its revenue guidance for the March quarter.
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The global coronavirus outbreak has become the biggest near-term threat to Apple’s business, disrupting production of its most important product, the iPhone, and causing the company to temporarily shutter half of its retail stores in China.
But Apple glossed over the topic during its annual shareholder meeting on Wednesday, as CEO Tim Cook largely ignored the coronavirus during his talk, leaving some attendees at the event surprised and perplexed.
Speaking just over a week after Apple announced it would miss its sales targets for the quarter because of the outbreak, Cook briefly touched on the outbreak, calling it “a fairly dynamic situation” and saying that it has caused “a challenge” for the firm.
“First priority is the health and safety of our employees and our partners,” Cook said during the meeting. “That’s where our energies are.”
Cook said he would try to answer any questions shareholders had during the Q&A portion of the meeting. But of the nine questions that Cook answered, four of them submitted in advance and handpicked by Cook, the topic never came up again.
“I figured there would be prepared statements,” said Ajit Rao, an Apple shareholder from Denver who travelled to Apple’s Cupertino headquarters for the meeting. “There was a little of that, but there was no detail.”
The coronavirus outbreak caused global stocks to plummet earlier this week, and on Tuesday US health officials warned the the disease’s spread to the US was “inevitable.”
An Apple representative declined to comment on why none of the pre-submitted questions Cook chose to answer at the meeting pertained to the coronavirus topic.
Questions about the effect on upcoming iPhone models
In a rare move, Apple revised its quarterly revenue guidance earlier this month citing supply constraints and weakened demand caused by the outbreak. The revision came after the company temporarily closed its stores, corporate offices, and contact centers in China. Apple corporate offices and contact centers have since reopened, and the company has resumed business at more than half of its retail stores in China, as Bloomberg reported.
But Apple said its iPhone manufacturing sites are ramping up more slowly than expected, which is part of the reason it said it does not expect to meet its estimated revenue of between $63 billion and $67 billion for the March quarter.
The coronavirus wasn’t a focal point during the meeting, but some advocates of shareholder proposals did mentioned it in their remarks. One advocate speaking on behalf of a proposal for Apple be more transparent with investors about its policies on freedom of expression, cited the coronavirus in her statements, for example. She said that the repression of free speech in China could restrict the ability of people to communicate about the outbreak.
Not all shareholders said that they were disappointed by Apple’s lack of an update on the coronavirus. Louise Freerks, a resident of Cupertino who has been an Apple shareholder since 1995, said the news is already saturated with information. “How much more can you say,” she said.
The coronavirus has made it difficult to make predictions about Apple’s performance and its future products. The company did not issue a new estimate for its March quarter revenue, but only said that it did not expect to meet the target range it had initially set. Reports on whether or not Apple’s upcoming devices will be delayed have also been mixed. Bloomberg reported that the rumored low-cost iPhone Apple is said to be working on is still on track to debut in March, while Nikkei Asian Review suggested the launch may be delayed, for example.
But despite this uncertainty, some analysts have said that they do not expect the ramifications from the coronavirus to materially impact Apple’s business in the long term.
“If this is truly one time in nature, if it is just a supply chain disruption, if it doesn’t really alter the fundamental long-term outlook, investors will give them a pass,” Robert Muller, an enterprise hardware analyst for RBC Capital Markets, previously said to Business Insider.
Timothy Arcuri, an analyst with UBS, said in a research note on Monday that investors are likely to pay closer attention to Apple’s expected iPhone 12 launch in the fall.