Apple shares hit 11-month low
Apple shares hit their lowest point in almost a year yesterday after investors, already jittery about the iPhone maker’s results next week, were spooked by reports of supply-chain cutbacks.
Shares in Apple shaved the $500 mark in pre-market trading and were about 3 per cent lower at $504.73 by late morning in New York.
Investors in the world’s most valuable company watched its shares rise from below $500 in early February last year to top $700 in September, from which point it has steadily declined.
Analysts’ consensus forecasts predict that Apple’s earnings will post a year-over-year decline for the first time in a decade.
The company warned in October that margins would be put under pressure by the simultaneous launch of many products, including the iPhone 5, iPad mini and iMac.
The trigger for the latest sell-off came with reports from Japan’s Nikkei newspaper and the Wall Street Journal that Apple had halved orders for iPhone 5 screens from suppliers for the period between January and March, to about 33 million displays.
Apple declined to comment on the reports.
Wall Street analysts including UBS, Jefferies and Citigroup had already reduced their estimates a month ago, citing lower component orders from Apple. The WSJ said that Apple had notified suppliers of the cuts in December.
Nonetheless, the sharp reaction from investors to the latest highlights nervousness ahead of Apple’s results next week for the three months to December.
Results from US mobile carriers, including ATT and Verizon, have suggested strong sales of the iPhone 5 before Christmas. But Apple is facing tougher competition from South Korea’s Samsung, which said yesterday that it had sold 40 million Galaxy SIII smartphones since its launch in May. – (Copyright The Financial Times Limited 2013)