Share prices of European suppliers of microchips, sensors and circuitry to Apple drifted lower Wednesday as investors stepped back from a global market rally after disappointing earnings from Apple put investors in a cautious mood.
According to a new report from Reuters, shares in several Apple suppliers fell after the smartphone giant reported a surprise dip in sales of its flagship iPhone. Dialog Semiconductor’s shares, for example, slid 2.9 percent at the open. They had plummeted 14 percent in April on fears over Apple bringing some of its components in-house.
“Dialog has been trying to diversify for a number of years to different sources, but unfortunately if your key relationship is with Apple and that’s because you have got great products, there’s risk and opportunity very closely aligned in that,” said Neil Campling, technology analyst at Northern Trust.
“Suppliers rely on strong iPhone sales for part of their profits,” reads the report, “and in some cases Apple’s announcement on Tuesday reawakened concerns about excessive exposure to Apple.”
As of the time of writing, Apple stock was down 1.7% in pre-trading following the company’s announcement that Q2 iPhone sales had missed expectations. Sales were down 1% year-on-year, though a higher average selling price meant that iPhone revenues were up by the same percentage.
Tim Cook blamed the slight fall in iPhone sales on customers waiting for the iPhone 8 – though he didn’t quite use that wording.
“We’re seeing what we believe to be a pause in purchases of iPhone, which we believe is due to the earlier and much more frequent reports about future iPhones,” said the Apple CEO. “That part is clearly going on. We are saying that in full transparency.”