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Apple could face lawsuits from investors over its revised earnings estimates

By Cookie Monster - on 6 Jan 2019, 1:00am

Apple could face lawsuits from investors over its revised earnings estimates

Following Apple's lowering of its revenue guidance for the first quarter of 2019 fiscal year, two law firms have launched investigations to determine if the company violated U.S federal securities laws. 

Acting on behalf of Apple's shareholders, law firms Bronstein, Gewirtz & Grossman and Bernstein Liebhard LLP are investigating whether Apple failed to warn shareholders about the slowing iPhone demand. They are questioning the statements made by Apple CEO Tim Cook in the latest letter to investors and what he said during the company's fourth quarter 2018 conference call on 1 November. 

On January 2, 2019, Apple revealed that its revenue for the first fiscal quarter of 2019 would be more than 7% lower than it expected because of "[l]ower than anticipated iPhone revenue, primarily in Greater China, [which] accounts for all of [Apple's] revenue shortfall to [its] guidance and for much more than [its] entire year-over-year revenue decline." 

Conversely, on November 1, 2018 CEO Tim Cook stated during Apple's fourth quarter 2018 conference call, that "[o]ur business in China was very strong last quarter. We grew 16%, which we're very happy with. iPhone in particular was very strong, very strong double-digit growth there."

Apple's market value has plunged from a peak of about $1.1 trillion to under 700 billion, no thanks to the latest investor note and a string of reports that sales of the iPhones are not doing well. 

Source: MacRumors