It isn't easy being Apple (AAPL +0.11%) these days.
Apple stock has fallen 37% since peaking in late September. The S&P 500 has climbed 13% in that time, with tech stocks leading the way higher.
It's easy to see why Apple stock has taken a beating. Margins are contracting. Profit targets are cascading. When customers do choose Apple products, they're often settling for older iPhones and smaller iPads that are cheaper.
It's not just Apple. Many of the smartphone companies that were rallying late last year have proven mortal this year.
Nokia (NOK +6.65%) is off 26% since peaking January. Analysts see Nokia returning to profitability later this year, but the company is now not even the leading seller of phones in its home turf of Finland.
BlackBerry (BBRY +3.27%) has shed 23% of its value since similarly peaking in January. Apple stock peaked the day that the iPhone 5 hit the market, and BlackBerry also appears to have topped off as it was introducing the first wave of devices running its latest mobile operating system.
Apple should bounce back, but it's going to have to innovate its way out of a slump again.
"We have several more game changers in us," CEO Tim Cook said at a tech conference earlier this week.
Unfortunately, the competition is not only changing the game, but doing so more often.
Samsung quietly introduced the Samsung Galaxy S4 Mini today. The new, cheaper, and slightly scaled back smartphone will provide a more affordable alternative to the Galaxy S4 that rolled out just five weeks ago.
Think about that. There's nothing wrong with the first S4. It has quickly sold more than 10 million units. Samsung is the global leader in smartphone sales. It's the one that overtook Nokia in Finland earlier this year. However, it's putting out a cheaper device to help it gain market share in countries that don't subsidize their smartphones. Isn't this essentially what Apple has been rumored to be working on for two years now?
I switched earlier this month. After owning iPhones exclusively since 2008 I caved in and bought an S4. I grew tired of waiting for Apple to incorporate the features that were in the S4. I was fed up with the small iPhone screen where I had to toggle between two different keyboards just because I wanted to type letters and numbers.
I'm not entirely sold on my S4. It's been buggier than my earlier iPhones. The learning curve was steeper than I thought it would be. However, my patience ran out, just as investors have decided to stop waiting for Apple to catch up.
As Apple waits roughly a year between iPhone rollouts, Samsung is proving its nimble ways. There's chatter of a new shatterproof and waterproof S4 rolling out later this year, and unlike all of the Apple hearsay that never comes to pass, it's easy to see Samsung making it happen.
The Galaxy S4 mini isn't perfect. The resolution isn't great. However, even the mini -- with its smaller 4.3-inch screen -- is larger than the iPhone 5.
Apple fans may laugh that off. They may argue that size doesn't matter, but Samsung's Galaxy S4 has several other features that Apple may be a generation or two away from embracing. As far away as Nokia and BlackBerry may be from their former glory days, at least they, too, are on the move.
There's no point in waiting these days. That's something that Apple may not know too well -- but Apple stock knows all too well.
