Apple’s iPhone slowdown could hurt the credit ratings of its suppliers

“It has been weeks since the slowdown in Apple’s smartphone sales hit the shares of the tech giant’s suppliers,” Alexandra Scaggs reports for Barron’s. “Now it is credit analysts’ turn to adjust their forecasts.”
“S&P Ratings predicts that Apple’s iPhone revenue will drop by around 15% in the company’s fiscal 2019, which started last October. That would be the biggest annual drop in the company’s history,” Scaggs reports. “And if the decline continues, it would not help the creditworthiness of Apple suppliers, the ratings agency says.”
“S&P lists five companies that have “moderate” exposure to Apple, and therefore could see their credit ratings face pressure in certain conditions. They are: Taiwan-listed Hon Hai Precision Industry, better known as Foxconn; Qorvo; Jabil (JBL); Korea-listed SK Hynix; and STMicroelectronics,” Scaggs reports. “Looking ahead. The worst-case scenario above would be worst for the two suppliers rated just one level above junk: Jabil and SK Hynix.”
Read more in the full article here.
MacDailyNews Take: The iPhone replacement cycle is lengthening, but it will eventually stabilize – just like it did with desktop Macs, portable Macs, iPads, etc.