Apple Inc. (NASDAQ:AAPL)’s shares are now down by 10% from its latest pre-iPhone high. Suddenly the Apple bulls seem to have gone quiet. Suddenly, there is no one agreeing that Apple is surely going to be the 1st $1 trillion company anymore. It seems like something is going on. However, shares of AAPL were rebounded about 2% from the recent lows.
Some of the reasons that may be playing behind the scenes are:
iPhone 5 is now ancient history and investors do not seem to have any major product declarations to look forward to for the moment. Earlier this year, investors have been expecting three major product catalysts from Apple, namely, the iPhone 5, the iTV and the iPad 3. iPad 3 and iPhone 5 have been released. The much-talked-about iTV has disappeared from everyone’s radar screen. If news starts to leak that Apple is about to roll out the iTV this year or early next year, investors may show excitement again. Else, it is more of a ‘buy the rumor’ and ‘sell the news’ kind of thing.
The initial sales of iPhone 5 were not satisfying. The sales number for the first weekend was 5 million. It was exceptionally worse that the ‘worst case scenario’ as cited by Wall Street’s top analyst. The number was way below expectations, irrespective of the issue being flaccid demand or supply problems. The disappointing release sales are likely to indicate that Apple will post abysmal overall iPhone sales for the September quarter.
Supply problems are resulting in concerns about iPhone sales in the last quarter of this year. The consensus estimate has been that Apple will sell over 50 million iPhones in the last quarter of this year. A month back, most people were of the opinion that this estimate is conservative. However, given ongoing reports of supply and manufacturing issues, and the percentage of iPhone 5 buyers, who are under agreement with mobile carriers and hence cannot upgrade as of now, it would not be a surprise if investors start worrying about Apple not hitting 50 million number in the December quarter.