Fears that Apple (NASDAQ:AAPL) will report a slowdown in demand for its iPhones when it reveals its quarterly profits on May 1 appear to be playing out, says Weston Twigg, a KeyBanc analyst.
Twigg notes that this week Teradyne Inc (NYSE:TER), the semiconductor-test equipment maker, cited a sharp drop in demand for mobile device testing, primarily due to a slowdown in demand from Apple for gear to test mobile devices.
This factor pushed Teradyne’s earnings guidance for the second quarter down well below consensus estimates, according to TheFly.com, the business website, which first obtained the KeyBanc note.
“Despite the strong first quarter results, the demand outlook for 2018 mobile device test capacity declined sharply in the quarter and our second quarter guidance reflects that revised outlook,” Mark Jagiela, Teradyne’s chief executive, said in a statement.
READ: Teradyne 1Q sales and profit rise; acquires Mobile Industrial Robots for US$148mln
In the second quarter, Teradyne is now predicting its adjusted earnings will fall between US$0.45 per share to US$.052 per share and its sales will come to US$490mln to US$520mln.
These figures pale by comparison to analysts’ projections. They had expected the group to earn US$.093 cents per share, with sales of US$690mln.
The stock of Skyworks Solutions, a wireless-smart phone chip maker, also inched down this week after Vijay Rakesh, an analyst with Mizuho, slashed his rating on its shares to neutral from buy on fears about a slowdown in iPhone sales.
Shares in Teradyne dove 15% to US$35.30 in midday trade Wednesday while Apple shares were up less than 1% at US$164.53.