- Apple and its suppliers were among the hardest hit during Tuesday’s broad plunge in both US and Asian markets. Some suppliers have slashed their targets, citing weaker conditions.
- The selling continued across Apple’s overseas supply chain on Wednesday.
- The iPhone maker closed down 4.4% Tuesday, hurt in part by an HSBC downgrade that cited “market saturation.”
Apple’s stock woes are bleeding into its global supply chain.
Shares of iPhone suppliers tumbled on Wednesday after Apple’s stock tumbled 4.4% on Tuesday – outpacing a particularly brutal 3.8% drop in the Nasdaq. Apple stock was hurt in part Tuesday by a downgrade by HSBC, which cited an overwhelming dependence on a single product, the iPhone.
“What has made the success of Apple, a concentrated portfolio of highly desirable (and pricey) products, is now facing the reality of market saturation,” HSBC said.
Here’s a round-up of the damage in Apple’s suppliers in Asia:
- Pegatron, in Taiwan, fell 1.7%
- The Chinese acoustics technology supplier AAC Technologies lost 3.7%
- Taiwan’s Flexium Interconnect was down 3.9%
- Taiwan’s Largan Precision declined 3.7%
In the US, Lumentum Holdings, an optical products manufacturer, fell 5.5% in regular trading on Tuesday after it cut its outlook last month.
Cirrus Logic closed down 1.9% down – having fallen as much as 5.8% days after it cut its December revenue outlook because of recent weakness in the smartphone market. Apple accounts for about 82% of Cirrus’ sales.
Similarly, Qorvo, a North Carolina semiconductor company, dropped 5.3% on Tuesday amid concerns about Apple, which recently lost its status as the world’s most valuable business.
Another Apple supplier, Broadcom, which reports earnings on Thursday, fell 4.1%. The company, which designs semiconductors, is believed to make about $US10 on each iPhone sold, according to JPMorgan, cited by CNBC.
Other manufacturers, such as Austria’s AMS, which develops facial-recognition software, cut its revenue forecast last month as iPhone sales diminished.
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