Apple's Stock Plummeted By 10% At Once

The company risks losing nearly $500 billion in market capitalization.

Apple's stock fell nearly 10% following the release of the company's forecast, which indicated that the company is having difficulty securing a sufficient supply of components.

This is reported by Reuters.

The component shortage is linked to the boom in data centers for artificial intelligence, which is straining global supply chains.

Major tech companies are ramping up production of advanced chips and memory chips for their AI data centers, leading to shortages and driving up prices. This is expected to lead to a contraction in both the personal computer and smartphone markets as early as this year.

If Apple’s stock continues to fall, it will mark the worst day for the stock since the sell-off triggered by the COVID-19 pandemic in March 2020.

A further decline could cost Apple nearly $500 billion in market capitalization and hand the title of the world’s most valuable company back to Nvidia, the artificial intelligence chip giant, the agency reports.

Apple CEO Tim Cook, widely regarded as a supply-chain genius, called the shortage “very significant” and said the company has limited options for addressing it.

Apple has partially cushioned the blow from rising RAM prices by drawing on accumulated inventory, but Cook said that the stockpile is dwindling and that the processor shortage is preventing the company from meeting high demand for iPhones and Macs.

The company’s quarterly revenue growth forecast of 9–11% also fell short of Wall Street’s estimate of approximately 12%

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