Apple Inc. Loses World’s Biggest Company Title as Shares Hit 18-month Low

Apple shares have hit their lowest levels in a year and half, after a supplier hinted at a slowdown in iPhone and iPad production.

Analyst Peter Misek at Jefferies & Co. said Cirrus’ news suggests a big decline in Apple sales in the April to June period. That supports his view that Apple is unlikely to launch a new iPad Mini in the quarter, and that the next version of the full-size iPad may launch late in the quarter rather than earl. Photo: Marco Paco/Flickr

Wednesday’s steep slide in Apple’s shares has pushed the tech giant to second place on the list of the world’s most valuable companies. Oil giant Exxon Mobil Corp. has reclaimed the throne.

The Wall Street Journal reports that the two companies have been jockeying back and fourth for the top position for much of this year. Apple has held the title for a little over a year, but before that, Exxon had been king dating back to 2006.

Google, Berkshire Hathaway and Wal-Mart make up the other top five businesses.

Apple, whose shares dropped below $US400 briefly before bouncing back to stand 5.5 per cent lower at about $US403, has lost more than 40 per cent of its market value since its record high last September, battered by worries about intensifying competition and the effect on Apple’s industry-leading margins.

The fall also means Apple has lost its title as the world’s most valuable listed company. Apple’s market capitalisation slipped to $US378 billion and oil and gas giant Exxon Mobil, with a market cap of $US385.7 billion, took its place.

One peculiar trend that has taken place this year: The S&P 500 has set new records without its two biggest components contributing to the rally. Apple shares are down 25% this year and Exxon Mobil shares are off 0.5% Meanwhile, the S&P 500 is up about 9%.

Late on Tuesday, Cirrus Logic, which supplies audio chips for the iPhone and iPad, said sales of a particular chip are slowing down as a customer moves to a newer component.

Cirrus did not name the customer, but Apple accounted for over 90 per cent of its business in the December quarter, something that makes Cirrus’s forecast a key indicator of Apple demand.

Analyst Peter Misek at Jefferies & Co. said Cirrus’ news suggests a big decline in Apple sales in the April to June period.

That supports his view that Apple is unlikely to launch a new iPad Mini in the quarter, and that the next version of the full-size iPad may launch late in the quarter rather than early. In the last three years, Apple has launched a new iPad in March or April.

Cirrus also forecast revenue for its first quarter ending in June of $US150 million to $US170 million, well below Wall Street’s average forecast of more than $US190 million.

“This is a tough environment, Apple is in transition between products,” said Michael Yoshikami, a portfolio manager at Destination Wealth Management, which owns about 50,000 Apple shares. Cirrus’s warning “makes it more likely Apple’s not going to surprise on upside.”

Apple does not comment on its suppliers’ announcements or its product plans. It is set to report results for the January to March quarter on Tuesday, says the Telegraph.

The latest decline in the stock comes after a bruising winter for Apple. The company’s stock is down 42 percent from its all-time high of $705.07, hit on Sept. 21 when the iPhone 5 went on sale.

Investors have concluded that with the demise of co-founder Steve Jobs, Apple may never again create another ground-breaking product of the magnitude of the iPhone or iPad.

Apple, which relies heavily on new products to drive its revenue growth, has not had a launch since last October when it unveiled its 7.9-inch iPad mini and an updated full-size iPad, reports the Sydney Morning Herald.

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