Weakening iPhone Sales Wipe $60B from Apple Market Capitalization

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Reports stating that iPhone demand is beginning to decline has erased more than $60 billion from Apple’s market capitalization.

According to a report from Financial Times, uncertainty surrounding the iconic smartphone led shares in the American tech giant to fall by as much as 4.1 percent on Friday.

In recent months, shares have been trading for around $175. However, on April 13th, they decreased to $165.72 following negative analyst predictions for upcoming iPhone sales.

On Thursday, they fell by 2.8 percent when key Apple supplier Taiwan Semiconductor Manufacturing issued a warning that global smartphone sales – including the iPhone – are slowing down.

The firm reported that its second-quarter revenues would be affected by “weak demand from the mobile sector”. Many analyst firms responded by downgrading their stock statuses on Apple.

Writing in a note to clients last week, Bank of America Merrill Lynch analyst Wamsi Mohan confirmed reports that iPhone sales are expected to decrease in the coming months.

“Given TSM’s guidance, we could see some additional downside to iPhone units. In our opinion, investors are already expecting a weaker CQ2, but the magnitude could be surprising to some,” said Lynch.

Last week, JP Morgan also issued a note about disappointing sales figures from the Cupertino-based tech company. Analyst Gokul Hariharan told clients: “TSMC’s 2Q18 guidance missed consensus expectations, largely due to weakness in high-end smartphones (Apple iPhones, in our view).”

“We believe the guidance now bakes in very weak iPhone shipments in 1H as well as a more cautious view on new iPhone build in 2H18.”

Morgan Stanley believes that shipments of the iPhone could decrease by 17 percent to 34 million in the coming months. That’s significantly below previous estimates of up to 43 million units sold.

“As was the case in the last two June quarters, we expect Apple revenue guidance to come in below current consensus estimates,” explained the firm.

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