Stock trading was temporarily halted Wednesday while Apple lowered its guidance.
When compared to the estimates provided by Apple to its investors in November, the revenue amount took a drastic nosedive, while the "other income/(expense)" category went through the roof, reaching approximately $550 million from an initial estimate of $300 million.
"In some developed markets, iPhone upgrades also were not as strong as we thought they would be", Cook writes, going on to blame macroeconomic factors, fewer carrier subsidies, the strength of the United States dollar and even the generosity of the company's cheap iPhone battery replacement programme breathing more life into older models. A chunk of this year's worldwide sales decline for iPhone and iPad occurred in China, according to Cook's letter. And just a few days after Geekbench's report was published, Apple said that it was, in fact, throttling the performance of older iPhones to prevent them from shutting down unexpectedly. A year prior, revenues came to $88.29 billion.
Like other luxury brands, Apple's sales are largely tethered to the Chinese economy - which began to slow in the second half of 2018.
Third, we knew we had an unprecedented number of new products to ramp during the quarter and predicted that supply constraints would gate our sales of certain products during Q1.
Mr Cook cited China as Apple's biggest weak spot, but also said that consumers weren't upgrading to the latest iPhones' models as eagerly as anticipated.
The warning, which came after trading in NY closed on Wednesday, looked likely to rattle already-volatile stock markets when they reopen on Thursday - with stock index futures pointing to Wall Street falls.
Apple previously told investors to expect revenue between $US89 billion and $US93 billion. That would make Apple's shitty quarter the world's problem, and that's just good management.
A timeline illustrating Apple share prices in 2018.
Shares of the Cupertino, Calif. -based tech giant slid almost 10 percent on Thursday - wiping out more than $75 billion in market cap and knocking it back to No. 4 among the world's most valuable companies - after it warned of slower-than-expected iPhone sales.
Apple's surprise announcement added to concerns about the ability of USA companies, particularly its technology giants, to navigate an increasingly uncertain economy and a continuing trade war between the United States and China.
The U.S. president, who is divided between his desire to inflict trade pain on Beijing and his worries about being identified with a "Trump slump" in the markets, tried to put the best face on things.