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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
Thu Jun 30, 2005 8:57 am Subject: Where are you RC?
Thu Jun 30, 2005 9:01 am 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.
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.
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.
Thu Jun 30, 2005 12:21 pm Subject: Forgot to log in
Thu Jun 30, 2005 1:09 pm Subject: iPod Now A Damaged Brand - Quality Problems Bite Apple
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/
Thu Jun 30, 2005 1:58 pm Subject: Zen Now A Damaged Brand - Quality Problems Bite Creative
QuoteRealityCheck 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!
Fri Jul 01, 2005 1:29 am Subject: Funny … Thanks RC !
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