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Nov.22 (NBD) -- Shares of Apple dropped 4.78 percent on Tuesday after Goldman Sachs maintained neutral rating for the smartphone maker and cut its price target from 209 U.S. dollars to 182 U.S. dollars.

Collectively, Apple stock has plunged 24 percent from its October high with 260 billion U.S. dollars vaporized, which amounts to the market value of Walmart.

It is reported that weak demand of new iPhone prompted the company to slash production orders for all three iPhone models unveiled in September, putting suppliers under pressure.

Apple optical sensor supplier AMS, smartphone screen supplier Japan Display, Face ID 3D laser supplier Lumentum, and chip supplier Qorvo are all seen cutting their forecasts.

Domestically, it is noted that the market share of Apple's Chinese supplier Hon Hai Precision Industry Co Ltd tumbled below NT$1 trillion (32.3 billion U.S. dollars) on Tuesday, setting a record low since November 2013. In addition, its subsidiary Foxconn seeks to slash 2.9 billion U.S. dollars in expenses.

According to financial data services and analytical platform Wind, as of November 21, 10 out of the 36 Apple-concept stocks in the A-share market have taken a 50 percent dive.

Wang Yanhui, secretary-general of the Mobile China Alliance, said that Apple's Chinese suppliers will be hit particularly hard in that they offer products with less technology compared with their overseas counterparts. To land orders, they might accept lower prices offered by Apple, which in turn undermines their profitability. 

In addition to weak cooperate performances of Apple and its suppliers, their stock prices are also affected by external factors, such as foreign exchange and trade friction.

Apple is seeing pressure in emerging markets such as Turkey, India, Brazil, and Russia, where the currencies have depreciated recently and less people can afford iPhone, said Apple CEO Tim Cook.

Facing weak demand in iPhone, Apple tends to generate revenue from services business, including services of Apple Store, Apple Music and iCloud. According to its financial report, that business hit a revenue milestone in Q4 2018 of 9.98 billion U.S. dollars, up 17 percent year on year.

Based on a research report of Morgan Stanly, the App Store is seen to be the largest driver within that category, accounting for an estimated 40 percent of services revenue, and will continue to sustain the sector's growth in the coming years.

Smartphone makers like Apple have a hug user base. To monetize the vase user base would bring more value than selling smartphones only, explained Wang. The market share of iPhone is big enough and Apple could eye somewhere else, she added.

In such case, hardware suppliers have to reduce dependence on Apple.

Email: tanyuhan@nbd.com.cn