Apple Inc shares dropped after warning from iPhone supply chain

Vastavam web: Shares of Apple Inc dropped nearly 2 percent on Tuesday as investors worries intensified about soft demand for iPhones after a warning from a company that supplies components for smartphones.South Korean chipmaker SK Hynix Inc (000660.KS) said following its quarterly report that it expected smartphone demand to stagnate, echoing a similar warning last week from Apple supplier Taiwan Semiconductor Manufacturing Co Ltd (2330.TW).

“The bar may not have been set low enough,” Wedbush senior trader Joel Kulina said of Wall Street’s declining expectations for iPhone shipments. “There’s still no visibility, and that’s going to keep a lot of money on the sidelines.”SK Hynix sells memory chips across the smartphone industry, as well as to companies making laptops, servers and other kinds of computers.GBH analyst Daniel Ives said in a client note on Tuesday he now expects Apple to ship 212 million iPhones in fiscal 2018, down from a previous estimate of 221 million.

Apple and investors had been betting that the high-end iPhone X, released last November, would rejuvenate iPhones sales in a global smartphone market that has become saturated in recent years.Smartphones account for two thirds of Apple’s revenue, about the same as three years ago, despite Chief Executive Tim Cook’s attempts to expand further into markets like music and smart watches.

Apple in January said it would make about $38 billion in tax payments to bring profits kept overseas back to the United States under new federal tax laws, suggesting it may repatriate around $245 billion.Analysts on average expect Apple’s March-quarter revenue to expand 15 percent to $61 billion, with adjusted earnings per share of $2.69, according to Thomson data.