Apple is cutting billions from its revenue estimates for the just-ended holiday season, citing sharply slower iPhone sales in China.
"While we anticipated some challenges in key emerging markets, we did not foresee the magnitude of the economic deceleration, particularly in Greater China," CEO Tim Cook said Wednesday in a letter to Apple investors.
Cook lowered the company's revenue guidance for the three months that ended Dec. 29 to about $84 billion from as much as $93 billion.
The announcement of weakness from one of the world's largest companies offers fresh evidence of a global economic slowdown, which has sent stock markets sliding in recent months.
Cook said that in its earlier projection, Apple had "expected economic weakness in some emerging markets. This turned out to have a significantly greater impact than we had projected." The company also saw "fewer iPhone upgrades than we had anticipated," he said.
In August, Apple became the first company worth $1 trillion. But its stock has dropped more than 30 percent in the past three months, leaving its market cap at below $750 billion. Apple's stock fell an additional 7.5 percent in after-hours trading Wednesday following the announcement.
Cook said the slowing in China's economy was made worse by "rising trade tensions with the United States."
Slumping financial markets seemed to hurt consumer confidence in China, he said, "with traffic to our retail stores and our channel partners in China declining as the quarter progressed."