Apple CEO Tim Cook has penned a letter to investors saying the company is revising our guidance for Apple’s fiscal 2019 first quarter, which ended on Dec. 29. You can read the entire letter at, but Apple now expects lower iPhone sales than previous forecast.

The tech giant is now forecasting the following:

° Revenue of approximately $84 billion;

° Gross margin of approximately 38%;

° Operating expenses of approximately $8.7 billion;

° Other income/(expense) of approximately $550 million;

° A tax rate of approximately 16.5% before “discrete items.”

Cook says Apple saw “fewer iPhone upgrades” than anticipated. The CEO also said that Apple Watch Series 4, iPad Pro, MacBook Air, and AirPods were constrained during the holiday season, and the company couldn’t keep up with demand.