Among the top tech firms worldwide, Apple has seen the biggest drop in terms of its leadership within the consumer electronics sector as a result of the Covid-19 coronavirus, according to research by GlobalData published today.
The latest edition of the data and analysis firm’s thematic scorecard for consumer electronics, which ranks the top companies in the sector in their leadership across ten currently most important themes for consumer electronics companies, has seen the Cupertino tech giant’s ranking tumble dramatically from fourth place in January to 14th in its latest thematic ranking.
Detailed in the report COVID-19 Impact on Consumer Electronics, from GlobalData Thematic Research, this drop is in contrast to rivals Alphabet and Amazon, with the former maintaining its position in first, and the second rising from third to second.
Microsoft has also taken a hit, albeit one that is less severe, dropping from second to fifth over the same period.
The top ten companies in tech, before and after the coronavirus
|January 2020||March 2020|
Apple sees worst coronavirus impact among key tech companies
For Apple, then, the coronavirus has dealt a far greater blow than for its main rivals, which could translate into weaker performance in the coming year.
This is because GlobalData found it to be far more sensitive to geopolitics and the negative effects of Covid-19 as a result on its significant reliance on China, both in terms of its supply chain and overall profits.
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“According to Apple’s latest earnings release, the Chinese marketplace accounts for 18% of Apple’s revenues. At the same time, more than 90% of Apple’s products are assembled in China,” the report states.
There have been particular problems with getting replacement iPhones to customers, as well as shortages of the iPad Pro. Apple also recently warned investors that it would fall short of its previous guidance on second quarter revenues for 2020, in part because it had to close all of its stores around the world as part of measures against the coronavirus.
Could Apple bounce back?
While the coronavirus has so far dealt a severe blow to Apple, GlobalData does see evidence that the company will bounce back as China recovers.
“The encouraging news for Apple and others is that as China has started to slow down the spread of COVID-19 and companies there have started going back to work,” the report states.
“Foxconn, the world’s largest contract manufacturer and the primary iPhone assembler and parts supplier, had half of its seasonal workers back at work in early March and expects to have resumed normal production in China by the end of March.”
Chinese Apple stores have now also re-opened, although others in the rest of the world remain closed.
For Apple, then, success over the next few months looks set to be heavily reliant on China.