After Cook’s China statements: Apple paid $490 million in class-action lawsuit

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A few sentences from Apple boss Tim Cook could cost the iPhone company almost half a billion dollars. According to court documents released over the weekend, Apple will settle the class-action lawsuit, which has been going on for years, by paying $490 million.

Cook made relatively positive comments about business in China in a conference call following the release of quarterly figures in early November 2018. Two months later, Apple took the unusual step of lowering its sales forecast to $9 billion, publicly citing a slowdown in its China business. The share price crashed and investors went to court.

According to the settlement agreement, Apple continues to not believe it violated any laws or misled investors. However, it was said that the company wanted to leave the matter behind as continuing the legal dispute would be long, time-consuming and expensive. The agreement still needs to be approved by a judge before it can go into effect.

Chinese Comment

In his conference call on November 1, 2018, Cook talked about the slowdown in business in emerging markets such as Brazil, India, Russia and Turkey. He also said he would “not put China in this category.” He later added: “Our business in China was very strong last quarter.”

Separately, Cook said Apple had seen no evidence that customers were avoiding the more expensive new iPhone models, the XS and XS Max, because they were waiting for the cheaper iPhone XR to be released later. But it was constrained by the fact that the company only had data for a fairly short period of time, a few weeks.

On January 2, 2019, Apple announced that the company was expecting revenue of approximately $84 billion for the just-ended Christmas quarter, instead of the previously anticipated $89 to $93 billion. Cook wrote to investors that the group did not foresee the extent of the economic slowdown, particularly in China. It was stated that the decrease in estimates was due to iPhone sales being lower than expected, especially in the Chinese market. (SDA)

Source :Blick