Is This Why Apple Opened Lower?

Shares of Apple (NASDAQ: AAPL  ) woke up on the wrong side of the bed this morning, down by 2% while the broader market was mostly flat. Scanning some early headlines, about the only report that could be feeding the bearish sentiment is one out of everyone's favorite rumor mill, Digitimes.

The infamously hit-or-miss publication says that Apple has reduced its orders of MacBook Pro models from component suppliers since Apple has "high inventory levels" for the ingredients. These tipsters say that shipments to the Mac maker are roughly 20% lower than the company's original estimates. The MacBook Pro is one of the product families that Apple is not facing supply constraints, and Apple's Online Store has all models in stock, including the ones featuring Retina displays. 

It's entirely believable that there may be some weakness in MacBook sales, considering the whole PC market is in a broad decline right now. Recent estimates peg Microsoft (NASDAQ: MSFT  ) Windows notebook unit sales down 10% over last year, while MacBooks were roughly flat. That doesn't bode well for Windows 8, which Microsoft was hoping would spur a PC upgrade cycle this holiday season.

The Mac has outperformed the broader PC market for more than two dozen consecutive quarters at this point, so 0% growth would still be topping the rest of the PC crowd. Still, the MacBook business continues to decrease in importance relative to overall results, despite its relatively healthy growth compared to the PC market.

Source: SEC filings.

Laptops now comprise just 11% of total trailing-12-month sales. That's half of the 22% contribution the business was just three years ago. That's not to say the MacBook business isn't important at all; just that it's far less relevant than iOS devices. Even if Apple is reducing orders, investors shouldn't be all that concerned.

There's no doubt that Apple is at the center of technology's largest revolution ever, and that longtime shareholders have been handsomely rewarded with over 1,000% gains. However, there is a debate raging as to whether Apple remains a buy. The Motley Fool's senior technology analyst and managing bureau chief, Eric Bleeker, is prepared to fill you in on both reasons to buy and reasons to sell Apple, and what opportunities are left for the company (and more importantly, your portfolio) going forward. To get instant access to his latest thinking on Apple, simply click here now.


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Comments from our Foolish Readers

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  • Report this Comment On December 04, 2012, at 5:41 PM, dstb wrote:

    Tax selling before the fiscal cliff. That's all it is. No other stock has more investors sitting on large gains.

  • Report this Comment On December 04, 2012, at 6:15 PM, dwilh51183 wrote:

    Tax selling is correct! Tim Seymour on CNBCs fast money just said to buy some Internet tech stock trading at 45 times earnings... is he crazy? Apple trading at eight times earnings Apple has already said they will make $52 billion this quarter alone. Does anyone out there realize how much money Apple is making! Apple is a monster... who cares if Google outsells them 6 to 1 cell phones are still selling billions and billions every quarter

  • Report this Comment On December 04, 2012, at 6:25 PM, EquityBull wrote:

    Laptops and PC"s being cannibalized by Apple ipads. Simple. Net apple will make more money as for each laptop lost they will seel 5 ipads in one flavor or another.

    Also mac's are a < 10% part of Apple's entire revenue now. Drivers are iphone and ipad. Mac and ipod are just little ecosystem gravy

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