Shares of major suppliers for Apple took a beating on Thursday as investors digested the company’s decision to cut its fiscal 2019 first quarter revenue guidance. Apple on Wednesday slashed its quarterly revenue estimate for the first time since 2002. The tech giant said the decision was triggered by slow iPhone sales in China, news that sent shockwaves across global markets.
Stocks of companies that supply accessories, microchips, and sensors for the iPhone maker were seriously hurt across various exchanges. Lumentum Holdings Inc. stock ended the regular trading session with a loss of $3.58, or 8.41% to change hands at $39.01. The company is the main supplier of the technology that powers Face ID feature and TrueDepth cameras in the latest iPhones. As of June 30 last year, Lumentum generated 30% of its total revenue from Apple.
The Nasdaq component had already lowered its fiscal second quarter revenue guidance on November 12, 2018 saying a large unnamed customer (which analysts assumed was Apple) had materially cut orders. Intel Corp., Broadcom Inc., Micron Technology, ended with declines of 5.5%, 8.9%, and 5.34%, respectively. All the three companies supply chips that are used to run iPhones.
NYSE-listed Qorvo Inc., which supplies radio frequency chips to Apple, was down $5.83, or 9.52% to $55.36 in the final minutes of trading. Last year, the North Carolina-based company lowered its own revenue outlook citing “demand changes for flagship smartphones.”
iPhone screens maker, Corning Inc., ended Thursday’s session down $1.85, or 6.19% to $28.03. Skyworks Solutions Inc. also gave away $7.24, or 10.65% to close at $60.72. Meanwhile, shares of 3M, the company that supplies touch sensor films for Apple smartphones, declined 3.77% to post a closing price of $183.76.
Investors of AMS AG, a chip maker based in Austria that supplies Apple with 3D facial recognition sensors for use in its smartphones, also had a rough day as shares of the company took a dip of more than 17%. AMS was one of the biggest decliners on the STOXX 600, SXXP index of major European stocks.
The Dow lost 2.8%, or 660 points, to 22686, the S&P 500 declined 2.5%, and the tech-heavy Nasdaq Composite dropped 3%.