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VIRUS OUTBREAK

Apple reopens stores in China in bid to recover from virus

29 of 42 retail outlets operating on shortened hours instead of typical 12-hour day

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Apple staff and customers at a shop in Beijing. As the coronavirus began to spread, demand for the iPhone fell 28 per cent in January compared with the previous month, according to government data.

Los Angeles 

APPLE Inc is reopening more than half of its retail stores in China, trying to rebound from a sales hit tied to the coronavirus.

As at Monday, 29 of 42 Apple stores in the country are opening, according to a review of the company's retail websites. Most of these locations are still operating on shortened hours. Some outlets will be open for fewer than eight hours. That compares with a typical 12-hour day, depending on location.

The Cupertino, California-based technology giant hasn't said when the remaining stores will reopen. However, some Apple websites for specific stores show that operating hours will return to normal as early as the end of this week.

Apple's retail footprint in China is critical to the company's sales. The store closures were one of two main reasons for Apple saying it wouldn't meet its revenue target of at least US$63 billion in the current quarter ending in March.

Chief executive officer Tim Cook told employees last week that retail locations in China were "starting to reopen, but we are experiencing a slower return to normal conditions than we had anticipated".

Earlier on Monday, an analysis of official government data showed that Apple's China iPhone shipments dropped in January as the coronavirus began to spread.

Demand for the product fell 28 per cent compared with the previous month, a bigger decline than usual for that time of year, according to a UBS research note, citing official Chinese data.

"February numbers are likely to be far worse due to both supply and demand issues related to the virus outbreak," UBS analyst Timothy Arcuri wrote in the note.

The situation is so fluid, Mr Arcuri wrote, that Apple hasn't given a new revenue forecast for the March quarter, saying only that the virus had stunted sales and slowed production. The pace of recovery in the company's June quarter "is more dependent on the demand side - which is very hard to predict", the analyst added.

Overall, January smartphone shipments in China slumped 37 per cent year on year, according to numbers from the China Academy of Information and Communications Technology. UBS's Mr Arcuri said iPhone sales climbed 5 per cent in the same period, thanks to its online stores and easier comparisons to the previous holiday period which was marred by trade war tensions. BLOOMBERG