- Apple cut its revenue guidance Wednesday in a letter to investors, citing weak iPhone sales and blaming economic issues in China.
- The revised guidance is sending Apple suppliers' stocks down.
- Several had already cut their own forecasts, citing reduced demand from a major client.
Apple's downgraded revenue guidance dragged its stock down 10 percent Thursday, and brought its suppliers and partners down with it.
Guidance cuts from some of Apple's suppliers gave investors the first whiff of bad news regarding the company's iPhone sales. Apple has been sinking over the past quarter on fears of slowing iPhone sales. Turns out, those fears were justified, as investors learned in Apple's disclosure Wednesday that it was cutting revenue forecasts to $84 billion from its original projection of $89 billion to $93 billion due in part to weaker upgrades to the new iPhone models.
Apple suppliers on Thursday sank almost as much as Apple itself. Qorvo, a radio frequency chip supplier for Apple, fell 9.1 percent Thursday, after it had already cut its own guidance in November. At the time, Qorvo said the reduction was due to "recent demand changes for flagship smartphones," Reuters reported.
Lumentum, the first Apple supplier to cut its guidance and warn investors of slow sales, fell 8.4 percent Thursday. The company supplies the technology behind Face ID, the facial recognition system installed on the newer iPhone models.
Semiconductor company Skyworks Solutions had also warned investors of lower revenue during its Septmeber-quarter earnings call, causing Citigroup to downgrade it shortly after due to speculation about the weak iPhone sales. On Thursday, Skyworks fell 10.7 percent.
Corning, which makes the glass for iPhone screens, dropped 6.2 percent Thursday. Cirrus Logic, which supplies audio technology to Apple, hit its 52-week low after falling 8.5 percent.
Chip suppliers for iPhones also sank, with Broadcom down 8.9 percent, Micron Technology down 5.3 percent and Intel down 5.5 percent. 3M, which makes touch sensor films for Apple screens, was down 3.8 percent. Qualcomm, which has been in an ongoing legal battle with Apple, was also down 3 percent.
Correction: Apple's stock fell more than 8 percent Thursday. An earlier version misstated the day.