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Apple reportedly asked its suppliers to cut iPhone production again — these suppliers could get hit the hardest (AAPL)


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Apple recently asked its suppliers to cut production on new iPhones again, the Nikkei Asian Review reported on Wednesday.
The revelation came just a week after the tech giant slashed its revenue forecast and blamed slumping sales on a slowdown in China.
Wall Street has already warned about supply-chain companies with a high dependence on Apple.
Here are the companies with a large percentage of revenues coming from Apple.

Apple’s waning product demand is likely to impact not just the tech giant itself, but also its suppliers.

On Wednesday, the Nikkei Asian Review reported that Apple late last month asked its suppliers to cut production on new iPhones by 10% for the January-March quarter. It was the second time in two months that the tech giant trimmed its planned production for its iPhone devices.

The report comes just a week after the company said its revenue in the holiday quarter would be more than 7% lower than it expected and blamed slumping sales on a slowdown in China amid Trump’s trade war.

With Apple products becoming less popular, companies that rely heavily on Apple are also under pressure. On Tuesday, Skyworks Solutions, which provides radio-frequency solutions for Apple, cut its earnings guidance, citing impacts by unit weakness across their largest smartphone customers. Skyworks is just one of the handful of Apple suppliers that slashed their forecast in the past few days.

And Wall Street has already been sounding the alarm on supply-chain companies with a high dependence on Apple.

“We are lowering our estimates for the names in our coverage that have the highest exposure to Apple,” Ambrish Srivastava at BMP Capital Markets said in a note out last week.

Also in December, Paul Coster, an analyst at JPMorgan said that Apple suppliers — such as Jabil, a manufacturing-service provider sees 24% of its revenue come from Apple — will be at risk if key customers reduce purchasing commitments.

Here is a list of Apple suppliers with a larger percentage of revenues coming from Apple:

Cirrus Logic

Ticker: CRUS

Business: Semiconductor supplier

Revenue from Apple: 79% of $1.2 billion annual revenue

Performance in the past 12 months: -36%

Wall Street Comment:

“The Apple continues biting back,” said Oppenheimer. “Apple remains Cirrus Logic’s flagship customer. Widely publicized iPhone production cuts have echoed through the Apple supply chain.”

Source: Business Insider

Glu Mobile

Ticker: GLUU

Business: Mobile games developer

Annual revenue from Apple: 54% of $155 million annual revenue

Performance in the past 12 months: +146%

Wall Street Comment:

“Looking forward, its quality improves but our estimates rating shows a deterioration, mainly due to a decline in revenue per share,” said SADIF Investment Analytics.

Source: Business Insider

Network-1 Technologies

Ticker: NTIP

Business: Software provider

Annual revenue from Apple: 53% of $6 million annual revenue

Performance in the past 12 months: -4%

Source: Business Insider

See the rest of the story at Business Insider …read more

Source:: Business Insider

      

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