Apple Inc. is into a tight competition. After climbing to more than $700 eight months ago, Apple's shares continued its steep decline on Wednesday, April 17th, 2003. After falling below $400 for the first time since 2011, the shares closed at $402.80, down $23.44, or 5.5 percent.
The declining share price is reducing the forecasts for the company, and at the same time, adopting a decidedly negative opinion about its future prospects and ability to thrive the technology market like it was known for before.
The trigger for the declining share was Cirrus Logic, which supplies analog and audio chips to Apple. The company issued a disappointing quarterly forecast, which got interpreted as a bad sign for Apple.
Apple and Competitors
The market is a place where competition keeps getting tighter. Another cause for the declining share could be that competition from Samsung and other smartphone manufacturers that compete in 2013 are eating into Apple's popularity, and depressing the sales of the iPhone.
It also could be that Cirrus Logic, and Hon Hai Precision Industry (Foxconn), which manufactures Apple devices, are waiting for Apple to manufacture millions of next-generation of iPhones, iPads, and iWatches.
Although Apple is having a steep decline of share and its market is slowly being taken by competitors, the company still outpaces all of its competitors when it comes to profit per device. The immediate problem could be that Apple hasn't introduced any new products this year. The company that never comments about new products it's developing - not wanting to give customers who don't follow Apple rumors a reason to wait - and that studied silence works against it in this environment in which the competition is charging forward.
Some customers and investors, may be tired of waiting for Apple to deliver something new. The Android competition certainly is delivering more appealing devices. And as mobile computing matures, the expectation is that the cadence and variety of products increase and pricing decreases.
In a research note, analysts concluded that Apple's most recent product cycle failed to generated the expected increase in market share and new user growth. Now analysts believe that Apple will have a difficult time hitting consensus expectations.
Apple and Products
Apple CEO Tim Cook has said, "The only thing we'll never do is make a crappy product. That's the only religion that we have. We must do something bold, something ambitious, something great for the customers, and we sweat all of the details."
Apple's religion and the income can get back well and synchronized, but not until people see the bold and ambitious Apple products comes to surface.