Apple Stock Plummets Nearly 10% Amid Component Shortage Fears
Apple's stock plummeted nearly 10% on Friday after the company released a disappointing forecast, which showed it struggling to secure enough components due to rising demand for AI infrastructure. The drop would mark Apple's worst day since the pandemic-driven selloff in March 2020 and erase nearly $500 billion from its market capitalization.
The decline would also return the crown of the world's most valuable company to Nvidia, which Apple had briefly reclaimed after a recent surge in value.
Tim Cook, Apple's outgoing CEO, described the shortages as 'very significant' and said the company had limited options to address them. Ben Bajarin, CEO of Creative Strategies, noted that even at Apple's scale, the company is running out of supply chain flexibility.
The shortage of processors is hindering Apple's ability to meet strong demand for iPhones and Macs, while its forecast for revenue growth fell short of Wall Street's estimate. The weakness in services also raised concerns among investors, as it coincided with strong iPhone sales that typically drive the business.