Shares of analog chip designer Linear Technology (Nasdaq: LLTC) are slumping today, down more than 3% on a solid earnings report but a gloomy outlook on the near future.             

The company beat analyst estimates for the second quarter with $0.62 of GAAP earnings per share and a flattish $384 million in revenue. But third-quarter revenue guidance disappointed as management took a defensive stance. The culprit was two-faced: A return to normal product lead times after a few quarters of high demand and constrained manufacturing had reduced the order bookings significantly, and sales into the computer industry will decline as "we will no longer remain in a prominent tablet computer program," as CEO Lothar Maier put it.

That's a heck of a euphemism. Linear is a known component supplier for the first-generation Apple (Nasdaq: AAPL) iPad. It does not contribute parts to the only other significant tablet of recent quarters, the Samsung Galaxy Tab, which uses power management chips from Maxim Integrated Systems (Nasdaq: MXIM) instead.

Given these dynamics, I think it's safe to say that Linear Technology won't appear in the iPad 2.

That's potentially a tough break for Linear, which prides itself on supplying parts for high-end electronics. The company's juicy profit margins tend to crush the profit shares seen in rivals like Maxim and Texas Instruments (NYSE: TXN). Losing the Apple account, or any part thereof, will look bad around the design tables at many of Apple's rivals in tablets and other electronics.

That's not the death knell for Linear, of course. The Stock Advisor recommendation will simply have to refocus its sales efforts in the mobile space, lest the company be relegated to mostly industrial accounts.

To see how the Stock Advisor team is reacting to this news, you can grab a free 30-day trial to our flagship service. Otherwise, just add Linear Technology to your watchlist to keep close tabs on where the company is going next.

Fool contributor Anders Bylund holds no position in any of the companies discussed here. Apple and Linear Technology are Motley Fool Stock Advisor recommendations. The Fool has written puts on Apple. The Fool owns shares of Apple and Texas Instruments. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. You can check out Anders' holdings and a concise bio if you like, and The Motley Fool is investors writing for investors.