Tech Stocks Slump as Earnings Season Approaches
Most notable was Apple’s hit, dropping the company’s share price under $400 for a brief moment — the lowest point since December of 2011 — before rising and hovering just above the $400 mark. Apple’s dive came after multiple negative reports for the company, including a Digitimes report claiming iPad mini shipments could tumble in the June quarter due to lack of demand.
Apple is expected to miss its estimates in its upcoming quarterly earnings report, come April 23.
Cirrus Logic, one of Apple’s components suppliers, noted on Wednesday that it will record a net inventory reserve of $23.3 million for the fourth quarter, citing lower volume of one of the company’s top product shipments as an unnamed customer transitions from one component to another in its products. Investors pounded its stock, sending shares down almost 14 percent.
Apple wasn’t alone in its dip downward on Wednesday afternoon. Shares of Facebook were trading off almost 1.5 percent at around $26.50, while the usually well-performing LinkedIn was down as much as four points at $178, a 2.5 percent drop, before regaining some ground.
Google was also trading down around 1.5 percent this afternoon, following recent news that software giant Microsoft had reached a licensing agreement with Foxconn parent company Hon Hai, which from now on will pay royalties on every Android and Chrome device manufactured by one of its companies.
The Dow was off about 1 percent overall on Wednesday afternoon.
Hewlett-Packard, the world’s leading PC manufacturer, fell by more than 2 percent in the wake of a disappointing earnings report from chipmaker Intel. Cisco Systems fell nearly 2 percent. Chipmaker Advanced Micro Devices fell by more than 1.6 percent. Salesforce.com fell by more than 1 percent.