Coronavirus: Microsoft warns of hit to computer sales

Microsoft is the latest tech firm to warn of disruption as suppliers are hit by coronavirus shutdown.

Microsoft is the latest major company to warn of a disruption as China grapples with the coronavirus outbreak.

The tech giant said because its Chinese suppliers were shutdown, manufacturing operations have been affected.

This delay could hit sales of its personal computing business including Surface tablets, Microsoft warned.

Microsoft said factories are re-opening across China, but this is happening slower than expected.

The Microsoft announcement highlights a growing problem for tech firms that rely on a complex network of suppliers in China for real-time deliveries of crucial parts. 

 

"With Apple the first one of the tech bellwethers to confirm the damaged supply chain post the coronavirus outbreak last week, it should not be a shocker … (that Microsoft's) PC business is going to be under near-term pressure related to supply chain issues in the region," said Wedbush Securities analysts Daniel Ives and Strecker Backe in a note.

Other computer and electronics makers are also suffering from the disruption to their supply chains, both voluntarily and forced, as they follow government health directives and take extra steps to keep workers at home to avoid further spread of the virus.

Foxconn, a key supplier to Apple, said it is continuing its efforts to bring its factories in China back up to full speed, but not at the expense of worker safety.

"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.

With many factories still closed after the Chinese New Year break, global firms are struggling to get the parts they need to make their products.

Car manufacturers have been closing production plants outside of China that rely on essential parts from the country. BBC

 
 

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