Apple earnings miss takes bite out of Asia supplier shares
Shares in top Asian suppliers to Apple Inc took a hit today after the company's latest quarterly results missed expectations, although several recovered ground as investors looked ahead to the company's new products later in 2012.business Updated: Jul 25, 2012 11:37 IST
Shares in top Asian suppliers to Apple Inc took a hit on Wednesday after the company's latest quarterly results missed expectations, although several recovered ground as investors looked ahead to the company's new products later in 2012.
Hon Hai, LG Display and Toshiba all sank more than 5% after Apple posted a 21% rise in net income to $8.8 billion, or $9.32 a share, lagging Wall Street's forecast of $10.37 a share.
Taiwan's Hon Hai, Apple's main manufacturing partner, partly recovered to stand down 3.4% at 0250 GMT in a broader market that was little changed, while South Korean flat-screen maker LG Display was last down 3.6%.
Japan's Toshiba Corp, which supplies NAND flash memory chips to Apple, fell 7.3% in a Tokyo market down 1%. Toshiba said on Tuesday it would cut production of memory chips to weather tumbling prices and oversupply.
A raft of smaller Taiwanese suppliers were a mixed bag, with camera lens maker Largan up 0.17% and touch panel supplier Wintek unchanged. Quanta Computer, which makes Apple's Macbook PCs, fell 2.8%. Mac computer sales were flat in the quarter from the previous one.
Pegatron, which assembles some Apple products including iPhones, was up 0.85%.
Barclays Capital said in a note that the downside would be limited for Taiwanese suppliers because they have already collectively underperformed Apple's share price by 40% year-to-date.
It added that those suppliers who had gained year to date, including Hon Hai and Quanta, may fall due to profit taking.
Samsung Electronics, which supplies chips for Apple, was down 0.8%, but investors were also keeping an eye on coming sales of the iPhone5.
Apple divided the blame for the shortfall between muted consumer purchases in Western Europe and a pullback in demand as consumers wait for the new iPhone model that many expect will be launched in September or October.
Fans are expecting Apple to launch a completely redesigned phone that has a bigger screen, rather than just add or change a few features as it did with the current model.