Tags:
Journalism of Courage
Apple Inc’s Asian supplier and assembler stocks fell on Tuesday on a media report that the iPhone maker had told its smartphone assemblers to halt plans for additional production lines dedicated to its new iPhone XR. Taiwan-based assembler Pegatron Corp fell 5 per cent and rival Hon Hai Precision Industry Co Ltd (Foxconn) dropped 3.6 per cent. Apple is widely considered the biggest customer for Foxconn.
Apple shares fell nearly 4 per cent on Monday after the report by the Nikkei financial daily, which fuelled concerns that the iPhone XR – the cheapest of three iPhones unveiled in September – was facing weak demand just days after it went on sale. The Nikkei, citing supply chain sources, said Apple had also asked smaller iPhone assembler Wistron Corp to stand by for rush orders, but the firm would receive no planned orders for the iPhone XR this season. Wistron shares were down 0.8 per cent on Tuesday.
Also read: Global smartphone market declines 6% in Q3 2018; Samsung continues to lead: IDC
On Apple’s post-earnings call last week, Chief Executive Tim Cook said he had very little sales data for the iPhone XR, but the other two models had got off to a “really great start.” Apple said sales for the usually busy holiday period would likely miss analyst expectations as sales in emerging markets including India were weak. Demand concerns have weighed on Apple’s stock in the past few sessions, pushing its market value below $1 trillion.
On Tuesday, shares in other Taiwan-based Apple suppliers fell sharply as well. Flexium Interconnect Inc and camera lens maker Largan Precision Co Ltd were both down more than 6 per cent. The Taiwan Weighted Index was down around 0.7 per cent.
Among other Apple suppliers in the region, Hong Kong-based acoustic components maker AAC Technologies Holdings Inc fell over 6 per cent. South Korean electronic parts suppliers Samsung Electro-Mechanics Co Ltd and LG Innotek Co Ltd were down more than 7 per cent. Apple on Monday did not respond to a Reuters request for comment. Foxconn, Pegatron and Wistron declined to comment.
