Shares of Apple suppliers crumble after lensmaker reports more than 25 percent decline in revenue
Shares of Apple suppliers in Asia took a beating on the back of a Taiwanese lensmaker reporting a more than 25 percent year-on-year decline in its November revenue.
Shares of Taiwan’s Largan Precision, a leading supplier of smartphone camera lenses, plunged 9.64 percent on Thursday morning. The company had reported a 28.57 percent decline in its sales for the month of November as compared to a year earlier.
Meanwhile, shares of contract manufacturing giant Pegatron fell 5.48 percent. The Nikkei had earlier reported that the company was preparing to shift production of its non-iPhone products affected by U.S. tariffs on Chinese exports to Indonesia in the next 6 months.
Hon Hai Precision Industry, better known as Foxconn, also declined by 3.49 percent. The contract manufacturer was also in the headlines after Reuters reported on Tuesday that it was considering an iPhone factory in Vietnam, citing Vietnamese state media.
Elsewhere in Asia, shares of Japanese electronic parts maker TDK fell 6.31 percent while component supplier Murata Manufacturing shed 4.34 percent. South Korean industry heavyweight Samsung Electronics also fell around 1.8 percent while Hong Kong-based acoustic components maker AAC Technologies declined by more than 5 percent.
Apple’s stock was not trading on Wednesday as the U.S. stock markets were closed in honor of former president George H.W. Bush. The Cupertino-based tech giant saw its shares fall about 4.40 percent on Tuesday after HSBC downgraded the company to hold from buy and cut its 12-month price target to $200 from $205.
“Apple’s iconic hardware unit growth is broadly over for now,” HSBC analysts said in the note.
“Revenues are only supported by higher selling prices and by the development of services. Flat unit growth has hit Apple’s share price and incidentally its key suppliers. What has made the success of Apple, a concentrated portfolio of highly desirable (and pricy) products is now facing the reality of market saturation,” they said.
— Reuters and CNBC’s John Melloy contributed to this report.