Apple slips as Loop Capital downgrades on iPhone shipment concerns

• Apple (AAPL) shares slipped 1.3% in premarket trading on Tuesday as Loop Capital downgraded shares to Hold from Buy, citing concerns about a cut in iPhone shipments.
• “The gist is that when AAPL previously reduced its Sep Q & Dec Q iPhone unit ships by 10% we believed they would be in a position to make up many (if not most) of these units through CY2027 as the reductions were supply related (memory & processors) & not demand related,” Loop Capital analyst Ananda Baruah wrote in a note to clients. “This no longer appears to be the case. Further, while not the core aspect of our call today we acknowledge then potential for [gross margin] risk as memory costs continue to increase. We continue to like AAPL’s longer-term share gain and Services story… but believe the stock also requires a fundamental catalyst reset after its recent stock appreciation... particularly given its trading at 5-year valuation highs as iPhone ships have been reduced and [gross margin] could see incremental pressure.”

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