The price of Apple shares tumbled overnight and hit a new 52-week low of $400.78 during todaqy's trading: the lowest price since December 2011. The shares closed at $426.24 last night, Tuesday April 16, and are 5.31 percent down at the time of writing.
Apple's market capitalisation has fallen from a peak of $658 billion last September, when the shares hit $705.07, to $379 billion today. The loss of $280 billion is roughly equivalent to a dozen Dells or 30 Red Hats.
Analysts were already fretting about Apple's next round of financial results, which are due next week. See yesterday's post by Larry Dignam:
The new information that moved the market, according to Bloomberg, came from Apple's audio-chip supplier, Cirrus Logic Inc. Cirrus said its sales would miss earnings, and that it would record a net inventory reserve of $23.3 million. Bloomberg reported that "Most of that -- $20.7 million -- is from a high-volume product from one customer, Cirrus said, without naming the client."
It added: "Apple accounts for more than 90 percent of Cirrus’s revenue, according to supply chain estimates compiled by Bloomberg."
The supposition is that the pile of unsold chips would have gone into iPhones and iPads.
We are also entering the period when some buyers may be expecting Apple to introduce new products, and therefore defer purchases of these inessential items. Some expected a new iPad this month, and a new iPhone 5S could appear in June or possibly September.
Also, as Larry Dignam noted yesterday, if Apple launches a $300 (unsubsidised) iPhone in September, this could hurt sales of more expensive and more profitable products.
Finally, Taiwan's DigiTimes claimed today that "Upstream sources in the iPad mini supply chain expect a 20-30 percent decline in shipments for the [iPad mini] during the second quarter of 2013 due to lacking demand in the market."
Either way, Apple shares have long been a "momentum play", where people buy stock in the expectation that it will keep going up. This is what creates bubbles. Since September, however, the momentum has been in the opposite direction, with the big profits being made by short sellers.
Meanwhile Apple's real business, which nowadays is based on selling truckloads of iPhones and iPads, continues to do well. If not, we'll find out next week.