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Stocks in Apple, iPod Chip Supplier Fall on Lower Expectations

by , 8:30 AM EDT, June 30th, 2005

Shares of Apple Computer (AAPL) fell Wednesday after SigmaTel Inc., the manufacturer of integrated circuits used in the iPod digital media device, cut it's outlook for the second quarter.

The company cited lower-than-expected sales and resulting price cuts, claiming that prices for its NAND flash chips have declined more than 30% over the past three to four weeks. SigmaTel expects prices to drop another 40% over the next several months.

CIBC analyst Daniel Gelbtuch believes that the lower orders could translate into lower sales of Apple's iPod Shuffle, which uses flash memory, reported the Reuters news agency.

"Management cited this pricing instability as a majorfactor in lower customer orders," wrote CIBC analyst DanielGelbtuch in a note to clients. The lower orders could translateinto lower sales of Apple's iPod Shuffle, which uses flashmemory, the analyst said.

Shares of Apple were down $1.09, or 2.9%, to $36.22 Wednesday. Shares of SigmaTel also declined, falling 14 cents, or 0.8%, to $17.60.

Observer Comments

Show: Subjects Only | Full Comments
Close Name:Syntax_Error Posts: 58 Joined: 07 Jun 2005
Subject: Where are you RC?

What a bloody shame. I saw this article and was hoping that RC would have his gloom and doom wisdom of the day smeared across it, but I guess I'm too quick. I'll just have to wait for later today.

Close Name:Syntax_Error Posts: 58 Joined: 07 Jun 2005
Subject: On a serious note

I wonder if any of this has to do with a possible market saturation. In all honesty, even the first gen iPods are still incredibly useful, so once the market is saturated by buyers, they don't have any need to upgrade. I guess that theory pokes a hole right through RC's logic of Apple using poor hardware since even the first gen products are live and well.

View Name:Guest
Subject: buy
Close Name:Syntax_Error Posts: 58 Joined: 07 Jun 2005
Subject: RE: buy

I agree, with the recent news of an Intel based system that will be able to run Mac OSX AND Winblows, which will inevitably be a very popular system, it would be wise to buy stock at the lowest price possible. Chances and hopes are that we won't see Apple stock this low again for a while, unless it splits of course.

Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject: Hmm

Wait I'm confused. I thought Sigmatel only provided the controller chip for the shuffle and other companies provided the flash memory. If that's the case, then what does Apple have to do with a decrease in orders of flash memory from Sigmatel? But I'd say its more likely their shortfall is mostly going to be caused by the decrease in flash prices and that obviously has nothing to do with Apple.

Close Name:Ampar Posts: 44 Joined: 04 May 2005
Subject: DOOM ! ! !

O.K. That's it. Apple's doomed. Will the last one out please turn the lights off?

(pre-empting a troll attack)

Sounds like time to buy to me IMNSHO.

View Name:Guest
Subject:
Close Name:geoduck Posts: 1726 Joined: 30 Dec 2003
Subject: Forgot to log in

The guest post starting with "I guess I'm confused..." yadda yadda was me

View Name:RealityCheck -   Troll Posts: 392 Joined: 06 May 2004
Subject: iPod Now A Damaged Brand - Quality Problems Bite Apple
Close Name:PontiMac X Posts: 17 Joined: 15 Mar 2005
Subject:

The posting quality problems have come home to roost. R. C. Gumby is now famous for pin-headed, shoddy merchandize. Check the facts Micro-Trolls:
http://macvspc.info/

View Name:Guest
Subject: If it's not expensive and poorly made . . .
Close Name:Intruder -   TMO Mac Specialist Posts: 2928 Joined: 07 Jul 2004
Subject: Zen Now A Damaged Brand - Quality Problems Bite Creative

Quote
RealityCheck wrote:
The iPod quality problems have come home to roost. Apple is now famous for pricey shoddy merchandize. Check the facts iLemmings:
http://hardware.silicon.com/pdas/0,39024643,39131292,00.htm


The Creative Zen quality problems have come home to roost. Creative is now famous for cheap, shoddy merchandise (notice it is spelled properly). Check the facts zLemmings:
http://www.techspot.com/vb/all/windows/t-25920-trying-to-understand-usb-and-creative-Zen-touch.html

EDIT: Ain't Google a hoot!

Close Name:Biff Posts: 1479 Joined: 08 Apr 2004
Subject:

Apple is so famous for quality problems that we have to be told about it. That makes sense. Just cause nobody has heard about them doesn't mean they aren't famous. Er. Something like that. DOOMED!

Close Name:jacrav Posts: 268 Joined: 04 Jul 2001
Subject: Funny … Thanks RC !

The article is garbage, but the 1 million or so posts following it are priceless !

Close Name:jacrav Posts: 268 Joined: 04 Jul 2001
Subject: What's weird …

… is that the memory maker's stock lost only .8% and Apple's 2.9%. Wall Street logic …

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