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Wedbush cuts iPhone revenue estimate by 14% for 2020 due to coronavirus

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What you need to know

  • Wedbush has cut its predictions for iPhone revenue this year and next.
  • Dan Ives has lowered revenue estimates by 14% for 2020.
  • He believes that the COVID-19 pandemic will stop "switchers" and "new-buyers" from moving to iPhone.

Analyst firm Wedbush Securities has cut its revenue estimates for iPhone in 2020 and 2021 due to the COVID-19 pandemic.

As reported by AppleInsider:

In a research note to investors seen by AppleInsider, Daniel Ives from Wedbush Securities is lowering iPhone revenue estimates by 14% in fiscal year 2020 and by 10% in fiscal year 2021 to reflect the change in near-term consumer demand, lockdown conditions globally, and a "negative economic backdrop." Practically, Ives believes that during the coronavirus pandemic, people looking to upgrade an iPhone still will do so, but "switchers" and new-buyers will wait, or not get an iPhone at all.

Ives reportedly believes that only "the installed based consumers currently in the window of an upgrade opportunity that have not upgraded their iPhones in more than 42 months" will buy a new phone for the foreseeable future. That's only around 325 million of Apple's 925 million iPhone customers

In 2020, he has revised revenue predictions down 14% to $131 billion from $152 billion. iPhone unit sales are estimated down at 172 million, compared to a prior forecast of 200 million.

Ives predicts a "modest gradual recovery" in 2021 but still believes iPhone revenue will be down by 10%. Apple has suffered tremendously as a result of the COVID-19 pandemic, its stock price falling to its lowest point since October last year. Currently, it is sitting at $237.37 in pre-market trading, a fall that would wipe off yesterday's recovery.

Stephen Warwick
Stephen Warwick

Stephen Warwick has written about Apple for five years at iMore and previously elsewhere. He covers all of iMore's latest breaking news regarding all of Apple's products and services, both hardware and software. Stephen has interviewed industry experts in a range of fields including finance, litigation, security, and more. He also specializes in curating and reviewing audio hardware and has experience beyond journalism in sound engineering, production, and design.

Before becoming a writer Stephen studied Ancient History at University and also worked at Apple for more than two years. Stephen is also a host on the iMore show, a weekly podcast recorded live that discusses the latest in breaking Apple news, as well as featuring fun trivia about all things Apple.