International Data Corp. says it’s revising its information technology spending forecast for 2020 downward, blaming the fallout from the rapid spread of the coronavirus.

According to indicators in the first quarter, IDC reckons there will be a significant decline in spending on both hardware and software as companies adjust to the situation. As a result, IDC says worldwide IT spending will grow by just 1% this year, down from its original forecast of 5% growth.

IDC had originally forecast strong growth in PC and smartphone sales, as well as increased demand for IT software and services. But it says the coronavirus will cause non-essential spending to grind to a halt as businesses choose to wait things out amid the ongoing economic uncertainty.

“The situation is extremely fluid,” Stephen Minton, vice president of IDC’s Customer Insights and Analysis group, said in a statement. “Things are moving so quickly that we need to constantly recalibrate our assumptions and expectations, but the pessimistic scenario reflects an IT market in which weaker economic growth translates into weaker business and consumer spending across all technologies over the next few quarters. Things could get worse, but hopefully not.”

The coronavirus, officially called COVID-19, causes a serious and potentially deadly respiratory disease. It has already caused substantial disruption to the tech industry. Numerous technology companies have been forced to cancel or postpone events to try and limit the spread of the virus, while hundreds of factories in China have been forced to shut down.

Apple Inc., for example, has temporarily closed dozens of stores in Asia because of lower demand for its products and problems with its supply chain, and today it closed all its stores in Italy. Meanwhile, Microsoft Corp. has warned that its More Personal Computing business unit will miss revenue targets because of lower sales of its Surface devices.

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