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September 26, 2011, 7:23 PM EDT
By Adam Satariano
(Updates with analysts’ reports in third paragraph.)
Sept. 26 (Bloomberg) -- JPMorgan Chase & Co. analyst Mark Moskowitz said research from his colleagues in Asia about a cut in iPad orders doesn’t represent the views of the securities firm’s U.S. team, and that “Apple is fine.”
Apple is cutting orders to vendors in the supply chain for its iPad tablet computer, a move that may mean slower sales for companies including Hon Hai Precision Industry Co., according to the earlier report by JPMorgan analyst Gokul Hariharan.
Apple’s stock fell as much as 3.2 percent in Nasdaq Stock Market trading today after the report. Competing analysts released research that differed with JPMorgan’s findings. Chris Caso, an analyst at Susquehanna International Group, said the resulting “chatter” was “misleading” and Gene Munster, at Piper Jaffray Cos., said changes in orders may be the result of Apple moving some iPad manufacturing out of Asia to Brazil.
The earlier report “has the equity markets worried about Apple,” Moskowitz wrote today. “Mr. Hariharan’s report focuses on how Hon Hai could be impacted by potential iPad sell-in order cuts. This alert is not the view of the U.S. IT Hardware team.”
Moskowitz maintained his projection that Apple will sell 10.9 million to 12 million iPads in the fiscal fourth quarter.
Apple, based in Cupertino, California, fell $1.13 to $403.17 in Nasdaq Stock Market trading after earlier declining to $391.30. The shares have gained 25 percent this year.
Unprecedented Cut
Hariharan’s report, dated Sept. 25, said multiple supply- chain vendors indicated a 25 percent reduction in so-called sell-in orders in the past two weeks, the first such cut that analysts at JPMorgan’s electronic manufacturing services team in Hong Kong said they have seen. Sell-in orders are those made by a company -- in this case, Apple -- to a supplier.
Moskowitz and Hariharan declined to comment beyond their respective reports. Steve Dowling, a spokesman for Apple, declined to comment. Edmund Ding, spokesman for Hon Hai, didn’t respond to an e-mail or answer calls to his Taiwan and China mobile phones.
Apple’s iPad may account for 73 percent of tablet sales this year, according to research firm Gartner Inc. Products that run on Google Inc.’s Android operating system, including Samsung Electronics Co.’s Galaxy tablets, will probably have about 17 percent of the market, Gartner said on Sept. 22.
Amazon.com Inc. may release a product later this year that could become the No. 2 tablet in the market behind the iPad, Moskowitz wrote in a report earlier this month.
--With assistance from Edmond Lococo in Beijing. Editors: Tom Giles, Nick Turner, Peter Eichenbaum.
To contact the reporter on this story: Adam Satariano in San Francisco at asatariano1@bloomberg.net
To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net
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(Updates with analysts’ reports in third paragraph.)
Sept. 26 (Bloomberg) -- JPMorgan Chase & Co. analyst Mark Moskowitz said research from his colleagues in Asia about a cut in iPad orders doesn’t represent the views of the securities firm’s U.S. team, and that “Apple is fine.”
Apple is cutting orders to vendors in the supply chain for its iPad tablet computer, a move that may mean slower sales for companies including Hon Hai Precision Industry Co., according to the earlier report by JPMorgan analyst Gokul Hariharan.
Apple’s stock fell as much as 3.2 percent in Nasdaq Stock Market trading today after the report. Competing analysts released research that differed with JPMorgan’s findings. Chris Caso, an analyst at Susquehanna International Group, said the resulting “chatter” was “misleading” and Gene Munster, at Piper Jaffray Cos., said changes in orders may be the result of Apple moving some iPad manufacturing out of Asia to Brazil.
The earlier report “has the equity markets worried about Apple,” Moskowitz wrote today. “Mr. Hariharan’s report focuses on how Hon Hai could be impacted by potential iPad sell-in order cuts. This alert is not the view of the U.S. IT Hardware team.”
Moskowitz maintained his projection that Apple will sell 10.9 million to 12 million iPads in the fiscal fourth quarter.
Apple, based in Cupertino, California, fell $1.13 to $403.17 in Nasdaq Stock Market trading after earlier declining to $391.30. The shares have gained 25 percent this year.
Unprecedented Cut
Hariharan’s report, dated Sept. 25, said multiple supply- chain vendors indicated a 25 percent reduction in so-called sell-in orders in the past two weeks, the first such cut that analysts at JPMorgan’s electronic manufacturing services team in Hong Kong said they have seen. Sell-in orders are those made by a company -- in this case, Apple -- to a supplier.
Moskowitz and Hariharan declined to comment beyond their respective reports. Steve Dowling, a spokesman for Apple, declined to comment. Edmund Ding, spokesman for Hon Hai, didn’t respond to an e-mail or answer calls to his Taiwan and China mobile phones.
Apple’s iPad may account for 73 percent of tablet sales this year, according to research firm Gartner Inc. Products that run on Google Inc.’s Android operating system, including Samsung Electronics Co.’s Galaxy tablets, will probably have about 17 percent of the market, Gartner said on Sept. 22.
Amazon.com Inc. may release a product later this year that could become the No. 2 tablet in the market behind the iPad, Moskowitz wrote in a report earlier this month.
--With assistance from Edmond Lococo in Beijing. Editors: Tom Giles, Nick Turner, Peter Eichenbaum.
To contact the reporter on this story: Adam Satariano in San Francisco at asatariano1@bloomberg.net
To contact the editor responsible for this story: Tom Giles at tgiles5@bloomberg.net
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