Coronavirus Infecting IT
In 2020, we started off the decade with COVID-19, a specific strain of the coronavirus. This virus has not only affected people in Wuhan, China and now numerous other places – including Washington and New York State – but also big businesses operating in China and around the world. China is the world’s biggest manufacturing supplier, followed by the United States. The outbreak in Wuhan, along with other cases in Shanghai and Beijing, has touched the biggest capitals of production, especially for the IT industry. Some of the biggest tech giants are expected to be 10% behind their last quarter for production.
One of the biggest tech giants, Microsoft, has most of its manufacturing in China; they said they will be experiencing shortages in production due to the outbreak. The delay of Surface tablets will negatively hit sales this quarter.
Another huge supply chain affected by the coronavirus epidemic is Apple. Apple’s industry supplier, Foxconn, is trying its best to proceed with production but is not willing to do it at the expense of its own workers.
“While our facilities in China have been delayed in their return to normal operations, our facilities in a number of other markets, including Vietnam, India, and Mexico, are running at full capacity, and expansion plans for some of our global facilities are being rolled out,” Foxconn said in a statement.
Apple is also experiencing a loss in sales due to closing about 42 of its Apple stores in Mainland China due to the outbreak. The company has also closed down their office and contact centers and will be working on business strategy to discuss how the virus is affecting suppliers in other regions of China.
The search engine giant has closed all of its offices since the end of January due to the first outbreaks of the coronavirus. The company has also placed restrictions on travel to China, Hong Kong, and Taiwan. American Google employees that were in China during the outbreak were told to stay home for two weeks.
Microsoft warned investors that “it will not meet its recent guidance for its personal-computing business.” The supply chain, which originates in China, has rapidly decreased since the outbreak of the virus, causing Microsoft stock to plummet -2.79%. With Microsoft taking a hit in production, it’s primary growth driver will be cloud computing, which is still accessible.
With the new outbreak of the virus happening every day all around the world, production has come to a halt in more places other than China. China is one of the biggest manufacturing countries in the world, but the U.S is right behind it.
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