Jan. 24 (Bloomberg) -- LG Display Co. and Hon Hai Precision Industry Co. led declines among Apple Inc. suppliers in Asia after the maker of iPhones and iPads reported its slowest profit growth since 2003.
LG, which provides displays to Apple, fell as much as 3.1 percent, the most in a week, to 28,000 won in Seoul trading. Hon Hai, which assembles Apple products, dropped as much as 3.2 percent to NT$82.30, the lowest level since Aug. 8. Suwon, South Korea-based Samsung Electronics Co., which supplies Apple and makes its own competing phones, fell as much as 1.7 percent to 1,448,000 million won as of 11:18 a.m. in Seoul trading.
Apple’s results also marked the weakest sales increase in 14 quarters and reinforced concerns the company’s growth is being hurt by higher production costs and gains by Samsung, its main rival in smartphones, dragging down shares by a third since September. Initial iPhone 5 sales were lower than some investors expected due to supply shortages, while consumers criticized new mapping software.
“The outlook for growth in the smartphone market is starting to get cloudier,” Tsunenori Ohmaki, an analyst at Tachibana Securities Co. in Tokyo, said by phone today. “Demand for high-end handsets like Apple’s may be getting saturated in developed markets like Japan.”
AAC Technologies Holdings Inc., which makes speakers for Apple, fell as much as 5.2 percent in Hong Kong, and display maker Sharp Corp. dropped 2.8 percent in Tokyo trading.
The Nikkei newspaper reported Jan. 15 that orders for iPhone 5 parts were cut about 50 percent following lower-than-expected sales.
Apple’s profit was little changed at $13.1 billion, or $13.81 a share, in the three-month period that ended Dec. 29, the Cupertino, California-based company said in a statement yesterday. Sales rose 18 percent to $54.5 billion, falling short of the $54.9 billion average of analyst estimates compiled by Bloomberg. Apple fell as much as 11 percent in late trading.
The lack of profit growth reflects higher manufacturing costs due to a product lineup overhaul ahead of the holiday shopping season. The company introduced the iPhone 5, iPad mini and a restyled Mac computer to draw customers in time for the first fiscal quarter, typically Apple’s most lucrative.
“For now, Apple business becomes a risk rather than a benefit,” said Yoo Jong Woo, a Seoul-based analyst at Korea Investment & Securities Co.
Sales of the iPhone, Apple’s biggest source of revenue and profit, reached 47.8 million units, matching the prediction by analysts surveyed by Bloomberg. The company also sold 22.9 million iPads, exceeding the projected 22.4 million units.
Samsung, in a preliminary statement of results on Jan. 8, reported an 89 percent jump in profit in the three months ended in December, boosted by its Galaxy line of smartphones. Samsung sold about 62 million smartphones in the quarter, according to a Daewoo Securities Co. estimate.
To contact the reporter on this story: Naoko Fujimura in Tokyo at email@example.com
To contact the editor responsible for this story: Michael Tighe at firstname.lastname@example.org