5 takeaways from Apple's stark China warning

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The iPhone maker has come up with what it hopes to be a solution to tepid sales in its second-largest market: get people to trade in their Android phones for credit to help them buy a newly-released iPhone. Apple's shares were briefly suspended on Wednesday night, and in post-market trading fell by up to 8pc, wiping nearly $60bn off its value.

Apple's decline dragged down the Dow Jones Industrial Average index on Thursday.

The yield on the 10-year Treasury fell to 2.64 per cent. Cook said the company expects revenue of $84 billion in the last quarter of 2018, $7 billion less than analysts had forecast.

Late a year ago, investors became anxious that the trend was about to worsen when Apple said it would stop reporting how many iPhones it had sold.

"While Tim Cook blamed a slowing China economy and trade tension, we maintain that in our opinion the iPhone ASP is the biggest problem given uninspiring specs and rising competition in China and in Europe", the analysts wrote.

Apple (AAPL) unexpectedly slashed its revenue forecast for the fiscal first quarter of 2019 on Wednesday, citing weakness in China and lower-than-anticipated iPhone revenue.

The announcement, made in a letter from Cook to investors, comes after weeks of signals from inside Apple and its supply chain indicating the Cupertino, California-based company is struggling to sell the latest iPhones released in September.

Apple shares listed in Frankfurt plummeted 8.7% on Thursday.

Bhansali has argued that consumers are no longer seeing the value for new models of Apple products, like the iPhone XS and MAX, which were more expensive than the iPhoneX, which she says itself was a disappointment.

Cook blamed the lowered forecast on several different factors, including the timing of its latest generation iPhone launches, a strong USA dollar creating foreign exchange headwinds, supply constraints, and economic weakness in some emerging markets.

Hall added that he doesn't see strong evidence of a consumer slowdown in 2019, but is still warning investors that Apple's replacement rates are likely to become more sensitive as the company approaches its maximum market penetration - just as was the case with Nokia.

Trump also seemed to suggest that the reason for Apple's recent misstep was the location of their manufacturing plants.

Apple (AAPL ) announced Wednesday after the closing bell that it would report lower-than-expected sales from the last three months of 2018, primarily because of weak demand for iPhones in China. "We grew 16%, which we're very happy with. iPhone in particular was very strong, very strong double-digit growth there'". The Trump administration responded by Apple products from the tariffs. We knew this would create a hard compare for the first quarter of 2019, and this played out broadly in line with its expectations.

Apple's CEO Tim Cook has recently confirmed what we all knew since mid-October: sales of the new iPhones aren't as high as anticipated and owners prefer to stick with their current devices rather than upgrade to the latest generation.