Apple Supplier AAC Tech Posts First Profit Drop in Four Years on Weak Phone Market

AAC Technologies Holdings Inc, an acoustic components supplier to Apple Inc, said on Wednesday second-quarter net profit fell for the first time in nearly four years, hit by plateauing iPhone sales and a sluggish global smartphone market.

Shares of AAC plunged almost 11 percent after the company said net profit dropped 39 percent from a year earlier to 653 million yuan ($95 million), the first quarterly fall since July-September 2014. The stock later recovered, closing 1.3 percent higher.

“Apple in terms of volumes is hitting a plateau this year, and while it has been successful in driving product prices and profits, volume stagnation affects its suppliers,” said Neil Shah, partner at Counterpoint Research.

Read more