Apple is reducing its 2008 production target of 18 million iPhone 3Gs down to 14 million. Recently, Apple’s shares approached their 52-week low hitting a rock bottom 25% in the last month compared to an 8% drop in the NASDAQ, prompting stock analyst Douglas A. McIntyre to warn investors to stay away from AAPL stocks.

The iPhone 3G suppliers are expected to take a hit, especially Skyworks Solutions and Triquint Semiconductor, two companies that produce power amplifiers for the device.

“The popularity of the 8 GB model reinforces our concern that smartphone demand has shifted to a lower price point [and] if Apple chooses to refresh its lineup with a 16 GB model at $199 and a 32 GB model at $299, this could put additional price pressure on the handset industry and… the component suppliers,” - wrote Pacific Crest in its report.

Sandisk and Micron Technology will also experience bad news as NAND memory prices will continue to fall. Linear Technology, On Semiconductor and National Semiconductor could also face some turbulence on Apple’s move.

Source:palluxo