Apple's latest iPhones may not be enjoying as much success as the company would like them to, as share prices for many of its suppliers - and Apple itself - are dropping today, according to Bloomberg. At the start of the month, Apple's earnings report for the fourth quarter of 2018 showed only marginal signs of growth for iPhone sales, and it seems that the situation is having a major impact on the company's suppliers too.
Specifically, Lumentum, a company which develops 3D sensing technology, saw its share price drop a record-breaking 30% today, on the same day it updated its forecast for the second quarter of 2019. The company cut back on its predictions due to a request from one of its largest customers to "meaningfully reduce shipments". Though no names were used in the report, market analysts believe that this is referring to Apple, Lumentum's biggest client. Analyst James Kisner added that the market for 3D sensing technology is going to be smaller than expected next year.
Other suppliers have been affected as well, with shares dropping for most of them. Oclaro, which is being acquired by the aforementioned Lumentum, saw a drop of 11%, Cirrus Logic dropped by 10%, and Broadcom dropped by 5%. Apple itself tumbled too, dropping by 4.1%. Bloomberg's report also specifically points to weak demand for the newest iPhones in China.
The stock market tends to be quite brutal, and drops and rises can happen very quickly for a variety of reasons. Following its Q4 earnings call, Apple temporarily dropped below the $1 trillion market cap value, but it recovered quickly. It remains to be seen if it will manage to do the same this time.