Apple Cuts Orders for iPhone 5 Parts Due to Weak Demand; Shares Plummet (AAPL)
On Monday Asian analysts at the Nikkei reported that Apple Inc. (AAPL) has cut its orders for parts of the iPhone 5 this quarter due to a diminishing demand of the product.
Apple has struggled with consumer demand of the iPhone 5 since it was released in September 2012. The move to cut orders of iPhone 5 parts from Asian suppliers signals further trouble for the tech giant as competitors, like Samsung, increase market share
Samsung has overtaken Apple as the smartphone power in recent years. The company has sold 100 million Galaxy S phones since its launch in 2010. Sales for Samsung phones like the Galaxy S3 and Galaxy Note II are expected to increase this year, with the launch of the Galaxy S IV expected in the next couple of months.
Analysts are expecting Samsung to sell 290 million smartphones in 2013 while Apple is expected to only sell 180 million.
Apple shares were down $16.35, or -3.14%, during premarket trading on Monday. The stock is up +23.94% over the past year.
The Bottom Line
Shares of Apple (AAPL) have a 2.04% dividend yield, based on Friday’s closing stock price of $520.30. The stock has technical support in the $497-$500 price area. If the shares can firm up, we see overhead resistance around the $530-$545 price levels.
Apple Inc. (AAPL) is not recommended at this time, holding a Dividend.com DARS™ Rating of 3.4 out of 5 stars.