Apple Supplier Stocks Fall Amid iPhone Uncertainty – PYMNTS.com
As Skyworks Solutions delivered weak fourth-quarter guidance for softness in high-end smartphones and Bank Of America Merrill Lynch downgraded the company amid iPhone uncertainty, suppliers of Apple’s iPhone XR are taking a hit in the markets, Seeking Alpha reported on Friday (Nov. 9).
Texas Instruments fell just over 6 percent, while Micron fell almost 5 percent. At the same time, Broadcom dropped by 3 percent, while Cirrus Logic was down just over 3 percent. Intel fell just under 1.5 percent, while Cypress Semi dropped by 2.7 percent.
The news comes as Apple has reportedly told Pegatron and Foxconn to stop plans for more production lines for iPhone XR in a bid to call off a production boost for the phone. With the new outlook, Foxconn might make 100,000 fewer phones each day, the Nikkei Asian Review reported.
“For the Foxconn side, it first prepared nearly 60 assembly lines for Apple’s XR model, but recently uses only around 45 production lines, as its top customer said it does not need to manufacture that many by now,” a source with knowledge of the matter told the outlet.
At the same time, Pegatron is reportedly stopping its efforts to increase production. In addition, sources claim that Apple told Wistron, a smaller company that assembles iPhones, to be on hold should rush orders occur, but the sources said the firm would not see iPhone XR orders during the holidays. And on Thursday (Nov. 1), in conjunction with its fiscal fourth-quarter earnings report, Apple announced that it will no longer report how many iPhones, Macs and iPads it sells each quarter.
Citing comments Apple Chief Financial Officer Luca Maestri made on the Cupertino, California company’s earnings conference call, CNBC reported that Maestri said the number of iPhones isn’t “representative of the underlying strength of our business,” and that “a unit of sale is less relevant for us today than it was in the past, given the breadth of our portfolio and the wider sales price dispersion within any given product line.”