Roger Fingas
Apple shares are down over $10 since Friday, reportedly part of a broader selloff of U.S. technology stocks, but also reflecting concerns over upcoming iPhones using slower cellular modems than their rivals.
Rumors that the "iPhone 8" and "iPhone 7s" won't offer gigabit downloads caused a dip in Apple shares on Friday, in turn leading the entire S&P 500 technology index to slip 2.7 percent, according to Reuters. While Apple shares managed $155 in early Friday trading, they fell later in the day and as of Monday morning were sitting at roughly $145.
Other affected technology stocks include Alphabet, Facebook, Netflix, and Microsoft, as well as Apple suppliers like Micron, Skyworks, and cellular chipmaker Qualcomm.
Bloomberg sources indicated on Friday that Intel won't have gigabit chips ready in time for this fall's iPhones, and that as a result, Apple will deliberately throttle units with Qualcomm modems. Apple has been doing similar throttling of the iPhone 7 to maintain a consistent experience across carriers.
Apple introduced Intel into its cellular supply chain last year, presumably for the sake of price competition and distancing itself from Qualcomm. The two companies are engaged in a legal war over royalties — Apple has accused Qualcomm of withholding money, abusing its market position, and pressuring chip buyers into signing patent licenses.
Phones with gigabit downloads are already on the market, including the Samsung Galaxy S8 and the HTC U11. In practice buyers are unlikely to see those speeds anytime soon, since they require ideal conditions and a nearby cellular tower supporting LTE Advanced.
AppleInsider Staff
Malcolm Owen
Oliver Haslam
Andrew O'Hara
Wesley Hilliard
William Gallagher
Christine McKee
33 Comments
I really don't understand the modem issue. The infrastructure isn't even there yet. It doesn't make sense it would put pressure on Apple's stock, but then again I never understand how APPL is so volatile compared to others.
oh please...with my cell phone already capable of significantly faster throughput than my 75 mbps home broad band connection...gigabit throughput is way low down on my list of nice to have features...but you know...apple...doomed.
There is no way that this silly modem rumor is why all the tech stocks dropped on Friday. It doesn't make any sense. Google's revenue, to pick just one example, is in no way tied to the success or failure of the next iPhone. Is the theory that people will decide to drop off the Internet if the next iPhone isn't as amazing as rumors have suggested and therefore Google will display fewer ads?
It's just s sector selloff. A panic. It has nothing to do with any alleged technical issues with the upcoming iPhone.