Apple’s share price has plummeted this morning, following an earlier report that said the Cupertino company had cut iPhone 5 component orders due to weaker-than-expected demand. When the market opening on Monday morning, Apple stock dropped to $16.23, or 3.1%, to $504.07.
The Los Angeles Times reports that a report from The Wall Street Journal regarding iPhone 5 component cuts “spooked Apple investors” and sent the company’s stock sliding even further. Sources familiar with the situation told WSJ that display orders for the device have been cut almost in half, while orders for other components have also been reduced.
Reuters corroborated the report on Monday morning:
Apple has asked Japan Display Inc, Sharp Corp and South Korea’s LG Display Co Ltd to roughly halve supplies of LCD panels from an initial plan for about 65 million screens in January-March, the Japanese daily said, citing people familiar with the situation, adding the U.S. firm also cut orders for other iPhone components.
Apple, along with Samsung, is just one of two smartphone makers in the United States seeing any growth. However, some analysts predict that Samsung’s range of devices, some of which appeal to emerging markets and budget-conscious consumers, will give the Korean company the edge going forward.
During 2013, it’s thought Samsung will increase share of the smartphone market to 35%, and gain an even bigger lead over Apple. Its Galaxy S devices are already selling incredible well, and in the coming months, it will unveil the Galaxy S IV, its next-generation Android flagship.
Numerous reports have claimed Apple will launch a low-cost iPhone by the end of the year in an effort to maintain its presence in the market. However, the company’s senior vice president or worldwide marketing reportedly told the Shanghai Evening News that Apple would not launch cheap devices just to grab market share.
Source: LA Times.