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Apple suppliers fall as new line-up fails to impress

Wednesday, 23 Oct 2013 | 12:25 AM ET
Apple's iPad Mini and iPad Air
Noah Berger | Bloomberg| Getty Images
Apple's iPad Mini and iPad Air

Shares of Apple's Asia-based supply chain plunged on Wednesday after the consumer electronics giant's latest product lineup, including its new iPad Air and iPad Mini, failed to wow investors.

Taiwan-listed camera lens manufacturer Genius, touch screen manufacturer TPK Holding and casing maker Casetek fell 4 percent, 6 percent and 2.2 percent, respectively. While Hong Kong-listed acoustic component maker AAC Technologies declined 1.6 percent.

Shares of Apple, meanwhile, ended down 0.3 percent in the U.S. trading session on Tuesday.

(Read more: Live blog: Apple reveals new iPad Air, iPad Mini)

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"The supply chain realizes the new products are not going to be a hit. The new iPad Air may do ok, but the Mini isn't going to sell well because it isn't priced competitively. They are right to be concerned," said Rob Enderle, principal analyst of the Enderle Group told CNBC.

Late Tuesday, the Cupertino-based company showed off its next generation full-size iPad called the iPad Air – which is lighter and thinner than its predecessor – and a new iPad Mini featuring a retina display. The iPad Air starts pricing at $499 for the 16GB WiFi model and will cost $629 for the cellular model. The iPad 2 will sell for $399.

Beyond the new tablets, Apple also introduced new versions of the MacBook Pro laptop computer with longer battery life among other updates.

"I don't think there's enough there to appeal to more than their current fan base – I don't think it will spur the kind of replacement that past products have caused," said Enderle.

Apple's product launches during the second half of the year are particularly important given the year-end holiday shopping season, which accounts for a large portion of the company's annual sales.

Apple takes a jab at Microsoft
Jamal Carnette, analyst at The Motley Fool, explains how Apple is taking a subtle jab at Microsoft through its software giveaways.

Brian White, analyst at Cantor Fitzgerald, had a more positive take on Apple's latest offerings, characterizing the iPad refresh as the "most significant" since the original iPad went on sale in April 2010.

(Read more: Apple's iPad not for you? Other tablet options)

"We were not disappointed. In fact, Apple surprised us on the upside. With Apple announcing that 170 million iPads have been sold since the introduction of the iPad, we believe this will prove to be a major upgrade cycle," White said.

Marc Einstein, industry principal, Consumer Telecommunications & Digital Media, Asia Pacific at Frost and Sullivan also expects the new products will be well received by consumers, particularly given that their availability coincides with the holiday season.

"There are a lot of first time buyers out there that don't own a tablet yet. For everyone four smartphones in the U.S., you have one tablet," he said, noting that the new iPads could help Apple grow its share in the tablet market of developed countries where consumers are less price sensitive.

(Read more: Nokia, Microsoft attempt to rain on Apple's parade)

—By CNBC's Ansuya Harjani; Follow her on Twitter @Ansuya_H

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  • Matt Hunter is the senior technology editor at CNBC.com.

  • Cadie Thompson is a tech reporter for the Enterprise Team for CNBC.com.

  • Working from Los Angeles, Boorstin is CNBC's media and entertainment reporter and editor of CNBC.com's Media Money section.

  • Jon Fortt is an on-air editor. He covers the companies, start-ups, and trends that are driving innovation in the industry.

  • Lipton is CNBC's technology correspondent, working from CNBC's Silicon Valley bureau.

  • Mark is CNBC's Silicon Valley/San Francisco Bureau Chief covering technology and digital media.

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