A new analyst report takes a pessimistic view of the potential supply-chain impact of the coronavirus, suggesting that could mean no 5G iPhones this fall …

In what Wedbush calls a ‘negative stress test scenario,’ the firm says that the reality may prove to be better, but it could also turn out to be worse.

Wedbush says that it sees a hit to iPhone sales in both the current financial year and the following one, which begins in the holiday quarter.

Clearly, anything can happen and this stress test exercise on Apple’s model could prove to be conservative or not aggressive enough given this fluid global pandemic. The duration and the scope of this disruption cannot be predicted, however we are taking our best calculated shot at our new model. As such, based on our lowered numbers we are reducing our price target to $335 from $400

Wedbush does not elaborate on whether its ‘no 5G iPhones in the fall’ scenario means that they will launch later in the year, or be pushed into the following year. In either case, that would fall into Apple’s 2021 financial year.

We are lowering our iPhone revenues by 14% in FY20 and 10% in FY21 to reflect the change in near-term consumer demand, lockdown conditions globally, and negative economic backdrop. Under this scenario we now assume only the installed base consumers currently in the window of an upgrade opportunity that have not upgraded their iPhones in more than 42 months purchase a new phone over the next 18 to 24 months.

Currently we estimate that ~350 million of Apple’s 925 million iPhones worldwide are in this upgrade window, as we assume going forward in a more draconian scenario that minimal new smartphone activity takes place besides this segment of Cupertino’s massive installed base.

It is widely expected that 5G will be the catalyst that creates record iPhone sales.

Although China is getting back on track with production after aggressive lockdown measures saw new coronavirus cases slow significantly, there are concerns that this may be a temporary lull. Once lockdown measures are eased, it is possible that the outbreak may again accelerate in the country.

The latest WHO report shows just under 180,000 confirmed cases worldwide, with 7,426 deaths.

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