Updated at 11:19 am EST
Apple (AAPL) – Get Apple Inc. Report shares slumped decrease Friday after analysts at Morgan Stanley cautioned that the tech large’s App Store income is slowing, creating what it referred to as ‘draw back danger” for services revenue growth over the current quarter.
Morgan Stanley analyst Katy Huberty, one of Wall Street’s most-respected Apple watchers, noted that App Store revenues were up 6% from last year over the two months ending in May, but a tougher June comparison could mean Apple will struggle to meet its the bank’s target of 15% net revenue growth for the quarter.
Huberty, who has an ‘overweight’ rating with a $195 price target on Apple stock, thinks app store revenue will speed up into the final months of the year.
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Apple shares were marked 4.3% lower in early Friday trading to change hands at $144.63 each, a move that would extend the stock’s year-to-date decline to around 20.5%.
Late last month, Bloomberg News reported that Apple is likely to keep 2022 iPhone production levels at around 220 million units, a figure that matches last year’s tally, as supply chain disruptions and China’s Covid lockdown impact supply and slowing global growth and Russia’s war on Ukraine dampen demand.
Apple CEO Tim Cook advised buyers in April that Covid and provide chain disruptions round what he referred to as the “Shanghai hall”, in addition to Russia’s struggle in Ukraine, would clip between $4 billion and $8 billion from present quarter revenues, marring an in any other case spectacular second quarter earnings beat.
The Wall Street Journal has additionally reported that Apple, which makes by some estimates round 90% of its {hardware} merchandise inside China, is seeking to develop manufacturing hubs in India and Vietnam to be able to each diversify its supply-chain and counter the influence of China’s draconian Covid lockdowns.
Source: www.thestreet.com