Apple’s prominent supplier, Foxconn, says its revenue declined 18.1% in February due to the Coronavirus crisis

One of the leading manufacturing partners for Apple Inc, Foxconn, said on Thursday that February marked the widest monthly drop in the company’s revenue in around 7 years. The electronics manufacturer blamed the rapidly spreading Coronavirus and its disrupting impact on global business operations to have fueled the loss.

The Taiwanese company revealed a massive 18.1% decline in its monthly revenue in February as compared to the same month last year. It also branded its monthly loss as the largest since March 2013. Foxconn that assembles iPhones for Apple Inc. also highlighted February as the third consecutive month of reduced revenue. Thursday’s announcement also saw Foxconn forecasting a significant hit to its quarterly revenue in Q1.

Apple Inc. Downwardly Revised Its Sales Guidance For Q1

The Coronavirus epidemic that has so far affected around 95,000 people and killed over 3,000 worldwide, is weighing heavily on global business operations. Foxconn is the latest addition to the list of companies that expect their financial performances taking a hit due to the health emergency. Foxconn’s top client, Apple Inc., also downwardly revised its sales guidance for the current quarter recently.

Formally known as Hon Hair Precision Industry Co Ltd, Foxconn accentuated in its stock exchange filing that its monthly revenue declined by $7.28 billion in February. In its guidance for the first quarter, the company said it expects a 15% decline in quarterly revenue attributed largely to the telecommunication products and consumer electronics. Foxconn, however, remained confident that in the second quarter as operations return to normal in mainland China, Foxconn will continue its journey towards recovering the revenue loss.

In light of the Coronavirus, Foxconn said that the probability of significant growth in revenue in the first half of 2020 remains negligible. For the full-year also, the electronics manufacturer was pushed to downwardly revise its previously given guidance of slight growth.

Foxconn Expects Operations To Return To Normal By The End Of March

In its announcement on Thursday, Foxconn also expressed confidence that operations will return to normal in China by the end of the current month. Mainland China marks the top production hub for the manufacturer.

Being a prominent supplier of Apple, a sharp disruption in Foxconn’s operations is likely to reflect in Apple’s business as well.

At the time of writing, Foxconn is trading at 58.50 TWD in the stock market that marks an around 15% decline in 2020 so far. Its performance in 2019 was also reported mildly upbeat with an annual gain of only 10%.