As more cases of coronavirus, COVID-19, appear in yet more countries, people are starting to freak out about catching it. The problem doesn’t stop there, though. The corresponding punch in the gut to the tech industry will have far-reaching effects–beyond not being able to buy the latest version of your favorite device.
Besides bringing health protocols to a high alert status, the coronavirus is creating a secondary scare in the tech industry. Some companies have massive portions of their supply chain and production based in China, some in Wuhan, where the virus first began to spread. The tech industry is definitely taking a painful hit. The virus is affecting supply, production, delivery, and sales.
In turn, tech company stocks are starting to tank, at least temporarily. Apple, Amazon, Microsoft. Facebook, Google reportedly lost more than $230 billion in a day. Ouch, buddy. That’s gonna leave a mark.
The fear remains that this is only the beginning. With coronavirus having landed in at least 48 countries, the fear is not unfounded. As countries scramble to deal with containment, treatment, and educating their populace, Wall Street and other major stock markets are predicting a global economic slowdown.
As of this writing, the coronavirus is not yet an official pandemic, according to WHO. This may change. A lot is riding on getting the spread of the virus under control. Doctors and scientists frantically work on a way to treat or cure it. Meanwhile, news agencies, public health organizations such as the WHO and the CDC work to dispel rumors, replacing them with timely and practical information. The big takeaways: wash your hands often, cover your mouth when you cough, stay home if you’re sick.
Smartphone producers are bound to be the worst impacted, with production predicted to decline 12 percent this quarter compared to previous years, reaching a 5-year low. The Mobile World Congress cancelled their annual phone show in Barcelona due to the virus. The MWC is one of, if not the, the biggest phone show in the world.
Apple announced they will not meet their quarterly goals, due to the impact of the coronavirus, hitting the tech giant on a few levels. Factories have been closed, though some are already reopening. Apple isn’t only feeling the impact due to supply and production concerns, but also because their global sales goals include sales within China, and sales are down.
Predictions are similarly dismal for smartwatches, laptop PCs, and smart speakers. The DRAM and NAND flash markets will likely stay on top of things, as they have production largely automated.
Amazon has not yet voiced much about their own issues, but we know from the stock market that it can’t be pretty. Amazon also has an estimated half of its products coming out of China. Like the other big companies, they are poised to lose a lot and see their stock value stripped of its sheen.
Video game console manufacturing is another industry to watch. However, they seem fairly protected for now, with the bulk of their business taking place toward the end of the year. New product launches, the PS5 and Xbox Series X will launch closer to the winter holidays, which gives the science industry pros time to fight and contain the spread of COVID-19 before it causes too much chaos in the gaming industry.
We have yet to see where this will all end. COVID-19 is on the move, and it’s taking these tech giants–and our global economy–on a scary, roller coaster ride. Despite the stock market taking a nosedive and tech labor and supply streams being hard-hit, you’re still more likely to catch the flu than the coronavirus. While we watch for better news, cross your fingers and remember to wash your hands. This one’s coming in hot.