Apple sinks after one of its facial-recognition suppliers cuts its outlook
- Apple facial-recognition supplier Lumentum slashed its quarterly outlook, citing a reduced shipment request from one of its biggest customers.
- In an annual filing, Lumentum listed Apple as its largest customer, contributing 30% of its revenue.
- Last week, Nikkei reported that Apple canceled a production boost for its iPhone XR model due to disappointing demand.
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Apple was sliding Monday, down 5%, after Lumentum, one of its facial-recognition suppliers, slashed its outlook for the quarter, citing a reduced shipment request from one of its biggest customers.
Lumentum makes special lasers, called vertical-cavity surface-emitting lasers (VCSELs), which are a key component of 3D sensors that could support some features of Apple's new iPhones, such as FaceID and augmented reality.
On Monday, the laser manufacturer cut its second-quarter outlook, saying it now sees revenue in the range of $335 million to $355 million, down from $405 million to $430 million. Meanwhile, earnings per share were guided lower - to between $1.15 and $1.34, from $1.60 to $1.75.
"We received a request from one of our largest Industrial and Consumer customers for laser diodes for 3D sensing to materially reduce shipments to them during our fiscal second quarter for previously placed orders that were originally scheduled for delivery during the quarter," CEO Alan Lowe said in a press release.
In an annual filing, Lumentum listed Apple as its largest customer, contributing 30% of its revenue. The company didn't mention Apple in the announcement.
Lumentum has previously said it received $200 million in orders for its VCSELs since April. It has multiple customers, but most analysts believe Apple was behind the surge in orders.
Last week, Nikkei reported that Apple canceled a production boost for its new cost-effective model iPhone XR due to disappointing demand. Its iPhone XR supports 3D facial recognition.
Earlier this month, Apple reported underwhelming third-quarter iPhone sales, and said it would no longer reveal unit sales for its hardware. Shares have fallen 12% since the results, pushing Apple's market capitalization below $1 trillion.
Apple was up 13% this year.
