Weak iPhone sales hit
shares of Europe's Apple suppliers
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[May 03, 2017]
By Helen Reid
(Reuters) - Shares of European suppliers of microchips, sensors and
circuitry to Apple fell on Wednesday after the smartphone company's
much-awaited iPhone sales missed expectations in the second quarter.
Suppliers rely on strong iPhone sales for part of their profits, and in
some cases Apple's announcement on Tuesday reawakened concerns about
excessive exposure to Apple.
Shares in Dialog Semiconductor, which provides power management systems
for Apple, fell 3 percent, among the top European fallers on the day.
The company has been in investors' focus since mid-April when a research
note from German broker Bankhaus Lampe suggested Apple could be
developing the capacity to bring its power management components
That report knocked as much as a quarter off of Dialog's market value on
the day. The company gets nearly 75 percent of its revenue from Apple,
according to Morgan Stanley estimates.
Imagination Technologies, a British designer of graphical processing
units used in smartphones, was down 0.5 percent. In April it said Apple,
its largest customer, would stop using its technology within 15 to 24
months, causing its stock to lose nearly two thirds of its value in a
company AMS, the maker of optical sensors for iPhones, dropped 2.1 percent and
Italy's STMicro, which provides the phone's accelerometers, gyroscopes and
motion sensors, fell 1.7 percent.
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An Apple iPhone 7 and the company logo are seen in this illustration
picture taken in Bordeaux, France, February 1, 2017. REUTERS/Regis
Shares in ASML, Europe's largest supplier to computer chip makers, fell 0.6
percent. The Netherlands-listed company is lower down the Apple supply chain
than Dialog and STMicro, supplying to Taiwan Semiconductor Manufacturing Company
which in turn serves Apple.
Apple said on Tuesday it sold 50.76 million iPhones in the quarter ended April
1, down from 51.19 million a year earlier, indicating that customers may have
held back purchases in anticipation of its 10th anniversary edition..
Analysts on average had estimated iPhone sales of 52.27 million, according to
financial data and analytics firm FactSet.
(Reporting by Helen Reid, Editing by Vikram Subhedar and Susan Thomas)
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