Apple mystery: Is Cook right or the supply chain?

A pedestrian passes an Apple store in San Francisco.
Robert Galbraith | Reuters
A pedestrian passes an Apple store in San Francisco.

One of the biggest mysteries in the market is whether the weakness in Apple's supply chain is indicative of iPhone 6S sales or if the company's positive guidance commentary on the last earnings call is accurate.

Shares of companies that make chips for Apple fell Tuesday on a negative read on the tech giant's supply chain from Credit Suisse.

Avago Technology traded down 4 percent, Skyworks Solutions fell 6 percent, Cirrus Logic was off 7 percent, Knowles declined 8 percent and Apple dropped 2 percent Tuesday morning.

"Apple has lowered its component orders by as much as 10 percent according to our teams in Asia. The cuts seem to be driven by weak demand for the new iPhone 6S," Credit Suisse's Kulbinder Garcha wrote Tuesday in a note to clients.

As a result Garcha cut his Apple 2016 earnings estimate by 6 percent and lowered his 2016 iPhone unit estimate to 222 million from 242 million.

The iPhone supply chain checks diverge markedly from the commentary Apple CEO Tim Cook gave on the earnings conference call Oct. 27.

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