THE WALL STREET JOURNAL. Wednesday, March 4, 2020 |B5

BUSINESS & FINANCE

uary, when executives cited
weak toy and electronics sales.
For the new fiscal year 2020,
Target forecast per-share earn-
ings between $6.70 and $7. An-
alysts had expected full-year
earnings per share of $6.88, ac-
cording to FactSet. Target said
the potential impact of the cor-
onavirus crisis is factored into
its current financial forecasts.
“We’ve set up a team over
the last month that is literally
meeting daily to monitor [prod-
uct orders], to understand the
state of production in China, to
understand the rate of workers
returning to work” and other
factors, Target CEO Brian Cor-
nell said. The retailer is shifting
product selection to reflect in-
creased demand and expected
supply delays, he said.
On Tuesday, Kohl’s reported
flat sales and profit in the holi-
day quarter. For 2020, the re-
tailer forecast a comparable
sales change in the range of -1%
to 1%, after posting a 1.3% de-
cline for 2019. The 2020 esti-
mates don’t include any impact
from the coronavirus.
Target’s comparable sales
for the full year rose 3.4%, and
digital sales rose 29%.

Continued from page B1

Epidemic

Stirs Retail

Uncertainty

Jan. Feb. March

Target

Kohl's

S&P500

Performance,year-to-date

Source: FactSet

5

–30

–25

–20

–15

–10

–5

0

%

nue projections for the current

quarter due to the epidemic,

which it said had limited pro-

duction of iPhones—its big-

gest-selling product—for

world-wide sales and weighed

on demand for its products in

China.

Foxconn’s production in

China has reached 50% of its

seasonally required capacity,

Mr. Liu said in a call with in-

vestors, adding that logistics

conditions have improved re-

cently. Foxconn’s required pro-

duction capacity varies by sea-

son as demand for many

electronic products like the

iPhone peaks around the win-

ter holiday season.

The recent crippling of fac-

tories in China due to the epi-

demic has again cast a spot-

light on Apple’s heavy reliance

on China, where it assembles

most of its products, raising

questions among analysts and

investors over whether Apple

should diversify its production

sites. Over the last two years,

The company expects iPhone production to return to normal if the coronavirus epidemic doesn’t worsen.

ALEKSANDAR PLAVEVSKI/EPA/SHUTTERSTOCK

“We may need to cancel ad-

ditional March SAT administra-

tions in other countries,” said

Jaslee Carayol, a spokeswoman

for the College Board, the New

York nonprofit that owns and

administers the SAT. Students

who had signed up for the

March exam will have the op-

tion to transfer to a May date,

she added.

During the 2018-19 academic

year, nearly 370,000 Chinese

students were enrolled at U.S.

universities, according to the

Institute of International Edu-

cation, making them the largest

group of international students

at American colleges and ac-

counting for a third of interna-

tional students studying in the

U.S.

Testing centers for Toefl, a

widely used test to measure the

English language ability of non-

native speakers, and the GRE, a

general graduate-school admis-

sions test, were closed in China

in February and will remain

closed until the end of March,

according to the Educational

Testing Service, which adminis-

ters those exams.

“China is one of the largest

source countries of interna-

tional students all over the

world, so any kind of an impact

is a big impact,” ETS spokes-

woman Allyson Norton said.

Toefl tests have also been

postponed until April 2 in Iran,

and at some locations in the

U.S., Canada, Japan, Italy and

Macau. The ETS said it

wouldn’t detail which U.S. test-

ing centers are closed except to

say site operations are made on

case by case.

ETS had more than 375 test-

ing centers in China and is pre-

pared to expand capacity there

if the centers reopen as

planned in April, the spokes-

woman said. She also noted

that spring isn’t the busiest

test-taking period because it is

typically late in the admissions

cycle for most schools.

The ACT, a college-entrance

exam alternative to the SAT,

closed its test centers in China,

Hong Kong, Vietnam and Thai-

land at the request of local offi-

cials for its February interna-

tional test date, and it will give

students who were signed up

the option to take the test on

any future international test

date at no charge or receive a

refund of their registration fee,

according to Tarah DeSousa, a

spokeswoman for the ACT.

“ACT is consulting with local

government and school officials

in each country and city to

make the appropriate deci-

sions,” she said.

China also canceled the busi-

ness-school admissions tests,

the GMAT, through March, ac-

cording to Geoff Basye, a

spokesman for the nonprofit

Graduate Management Admis-

sion Council, which administers

the GMAT.

Several college-admissions

tests including the SAT, ACT,

GMAT and Toefl have been

postponed at some interna-

tional locations amid the

spread of the coronavirus, po-

tentially weighing on the vol-

ume of international student

applications U.S. universities

receive.

In China, the February and

March sittings of the SAT and

ACT, two exams for undergrad-

uate admissions to many Amer-

ican colleges, were canceled

across the country, according

to the organizations that ad-

minister those tests. In other

areas, including Mongolia,

Hong Kong, Vietnam and Thai-

land, some testing sites have

been temporarily closed.

BYPATRICKTHOMAS

College-Admission Tests Are Canceled

Foxconn Technology

Group, which assembles

iPhones forAppleInc., expects

production levels at its plants

in mainland China to return to

normal seasonal level this

month if the coronavirus epi-

demic doesn’t worsen, the

company’s chairman said

Tuesday.

Like many manufacturers in

China, Foxconn extended the

Lunar New Year holiday that be-

gan in January as the coronavi-

rus outbreak worsened. The

company resumed production in

recent weeks, but its biggest

challenge has been a shortage of

workers, said Chairman Young-

Way Liu. To curb the spread of

infections, the Chinese govern-

ment has restricted the move-

ments of at least half a billion

residents in more than 100 cit-

ies through lockdowns and

travel restrictions.

Apple declined to comment.

During an interview with Fox

Business Network last week,

Chief Executive Tim Cook said

Apple had reopened factories

and was ramping up production.

In February, Apple became

the first major U.S. company to

say it wouldn’t meet its reve-

Apple has also faced the fallout

from the trade war between

the U.S. and China that in-

cluded tariffs on certain made-

in-China goods.

Mr. Liu said the U.S.-China

trade war has already pushed

Taiwan-based Foxconn to look

beyond China in the long run.

He also said the likelihood of

Foxconn shifting production

out of China is higher if Presi-

dent Trump is re-elected.

Foxconn is eyeing Southeast

Asia as a destination of future

expansions, Mr. Liu said. It has

been expanding in Vietnam and

India, and has plants in Mexico,

Brazil and other countries.

Foxconn, formally known as

Hon Hai Precision Industry Co.,

says it is the biggest private-

sector employer in China. To

bring back workers to its

plants, including major iPhone

assembling sites in Zhengzhou

and Shenzhen, Foxconn has

been offering cash bonuses of

more than $750 for those com-

ing to work there. Many local

governments have also orga-

nized group transportation for

migrant workers.

—Yang Jie, Yoko Kubota

and Tripp Mickle

Apple Supplier Foxconn Foresees Rebound in China

ETS had more than

375 testing centers

in China and is

prepared to expand.

THE MOST

INFORMED, WINS.

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