Apple, which has been the global market leader for the past 10 years with the iPhone, has been caught by the Chinese market.
Apple CEO Tim Cook told shareholders in a letter on January 3 (local time) that he will adjust his sales forecast for fiscal first quarter of 2019 to $84 billion.
When it announced its quarterly performance in November of last year, Apple had previously estimated its sales for first quarter at $89 billion to $93 billion.
Apple's sales in the fourth quarter of last year stood at $88.293 billion, a drop in profits of more than $4 billion.
Tim Cook explains that the total profit margin for the first quarter will also be around 38%.
Apple's stock price plunged 7 percent in transactions outside the time of the New York stock market after the news was announced.
Tim Cook pointed out that the reason for the slump in sales is poor sales of iPhones in China.
The trade dispute between the U.S. and China has also caused sales in China to drop for Mac and iPad.
"The rising trade tension between the U.S. and China has affected China's economic environment," said Tim Cook. "We won't sit around and wait for things to change and will concentrate on the things we can control and improve the situation."
Although Apple released high-end models such as iPhone XS last year, iPhone XR, which is a low-end model, has become more popular in the market.
In addition, anti-Apple sentiment is growing in China, and Chinese people are moving to use Huawei's products instead.
Recently, Chinese social networking service WeChat and portal Baidu frequently post messages saying "the rich use Huawei and the poor use Apple."
The arrest of Meng Wan-zhou, the vice chairman of Huawei is also seen as a reason why Chinese people have strong patriotism towards Huawei.
