Om Malik, writing about Apple’s revised quarterly guidance:
China slowdown is actually a much wider problem. It is unlikely that the Chinese government will ever talk about problems in its economy. So we are slowly starting to see US companies give their assessment of the Chinese economy. For instance, back in mid-December, when all of us were floating on cloud eggnog, FedEx was reporting earnings that pointed to tough times ahead. “The peak for global economic growth now appears to be behind us,” chief marketing officer Raj Subramaniam remarked on a conference call with investors.
And Trump’s trade war:
The trade war — which has gone from being a tweet to a tornado that has ripped the roof off one of Silicon Valley’s stalwarts. Trade wars obviously have a consequence, and Apple is suffering like every other luxury and fashion brand that has been too reliant on the Chinese consumer. Like Apple, they too have been puking on the side of the proverbial Wall Street. Tiffany, for instance, is down almost 14 percent over the past three months. Coach is performing even worse, almost as bad as LVMH, the company that owns Louis Vuitton, Loro Piana and a whole bunch of others.
Apple isn’t alone in feeling the pinch.