Amid of poor sales forecast for iPhones, many suppliers or components makers like Qovro, Lumentum have cut their revenue forecasts. It led to some inadvertent speculation of Apple cooling down the manufacturing of the iPhones. Well, the speculation has led to damage of $107 billion loss in Apple’s market value. Though, the things have rebounded, but initially, it made Apple stocks tumble to six month’s sharpest fall.
The shares went down by 2.5 per cent in the noon at New York stock exchange. The continuous slump for 4 days gets into the 5th consecutive day which led to the sharpest fall within the last six months. Apple’s stocks fell by 11 per cent and it has led to a loss of $107 billion market value. This year, the Cupertino giant has registered only 11% growth rather than the 40% in the last year.
Both decline in sales and supplier’s forecasts has led to such a situation for Apple on the stock market. Now, things have rebounded after analysts suggest to “buy the dip”.Although the increase was not as significant as it plunged, but still it has recovered a bit.
The latest developments have also led rating agency, Guggenheim to downgrade Apple’s rating to the equivalent of hold. They also added that the high selling iPhones are “no longer enough” to engine its growth.
On the other hand, Huberty is saying that supplier warnings shouldn’t have hurt Apple as much. Huberty added that”Weaker supplier guidance reflect Apple’s already more cautious Nov. 1 guidance and, importantly, doesn’t impact our service growth forecast, which is tied to the installed base rather than new shipments,” Huberty wrote in a note to clients. “We’re buyers on unit-driven pullback given services and share repurchases drive future earnings.”
Huberty advises “a look back at the past seven negative revision at iPhone suppliers suggests these data points don’t predict future share price performance, particularly beyond a one-month period.”
Currently, Apple is looking to increase the services like in the App Store with a different offering. They are also meddling ways to make Apple Care and iCloud more feature enriched for better sale margins.
(Via)
