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Apple Reported to Cut Parts Orders for iPhone

courtesy of Apple Inc.A reduction in orders for display screens could mean that sales of the iPhone 5 from Apple Inc. (NASDAQ: AAPL) are not going to meet the heady projections many analysts and investors expect. The company’s orders for…

By Paul Ausick
Published January 14, 2013, 7:32am ET · 1 min read

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iPhone_5_FrontBack

courtesy of Apple Inc.
A reduction in orders for display screens could mean that sales of the iPhone 5 from Apple Inc. (NASDAQ: AAPL) are not going to meet the heady projections many analysts and investors expect. The company’s orders for iPhone 5 screens have dropped by approximately half, according to two unnamed sources cited by The Wall Street Journal.

This is not just bad news for Apple, but will have a negative impact on all the company’s iPhone parts suppliers. Display makers Sharp Corp., Japan Display Co. and LG Display Co. Ltd. (NYSE: LPL) will take a direct hit, of course. But other component suppliers like Qualcomm Corp. (NASDAQ: QCOM), Broadcom Corp. (NASDAQ: BRCM), Skyworks Solutions Inc. (NASDAQ: SWKS), Cirrus Logic Inc. (NASDAQ: CRUS), TriQuint Semiconductor Inc. (NASDAQ: TQNT) and Avago Technologies Ltd. (NASDAQ: AVGO) could get steamrolled as well.

According to the WSJ, Apple notified suppliers of the order cuts last month.

Apple’s shares are down about 3.9% in premarket trading this morning, at $500.00 in a 52-week range of $418.66 to $705.07. The weight of an Apple share slide on the Nasdaq Composite will be substantial today. Cirrus Logic’s shares are down 4.5%, Qualcomm is down 1.3% and Avago is down 4.8%. Skyworks and TriQuint are inactive. The Nasdaq Composite futures is down 0.4%.

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Paul Ausick

Paul Ausick has been writing for 247Wallst.com for more than a decade. He has written extensively on investing in the energy, defense, and technology sectors. In a previous life, he wrote technical documentation and managed a marketing communications group in Silicon Valley.

He has a bachelor's degree in English from the University of Chicago and now lives in Montana, where he fishes for trout in the summer and stays inside during the winter.

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