updated 04:00 pm EDT, Tue July 31, 2007
Apple shares down 7%
Shares of Apple Inc. sunk nearly 7 percent during normal trading hours on Tuesday, falling to around $132 on volume of about 62 million. The primary driver for the declines is speculation by financial firm Miller Tabak & Co. that Apple will reduce its current production of iPhones from 9 million units to 4.5 million units, potentially indicating a reduction in sales targeting. Apple last week announced that it had sold 270,000 iPhones in the first two days of sales on opening weekend, nearly double the AT&T estimates of 146,000 activations, but well short of analyst expectations. The company did not back off its initial projections, however, maintaining that it will have sold 1 million iPhones by the end of its fiscal fourth quarter, and 10 million iPhones by the end of 2008.
During its fiscal third quarter conference call, Apple also said that it is on track to begin selling the iPhone in Europe during the fourth calendar quarter of this year, starting with a few major countries and expanding into other countries throughout 2008. Apple CFO Peter Oppenheimer also reminded investors that Apple has yet to see a dime of revenue related to payments from AT&T during the June quarter, but said that revenue will show up in the company's September quarter results.