Among other Apple suppliers, Cirrus Logic Inc. sank 14 per cent, Qorvo Inc. and Broadcom Inc. each slid 6.4 per cent, ON Semiconductor Corp. fell 5.9 per cent, Skyworks Solutions Inc. fell 5 per cent, and Finisar Corp. dropped 4 per cent. Semiconductor stocks were broadly lower with the Philadelphia Semiconductor Index losing 4.4 per cent.
Apple shares are sliding on Monday after a series of bad data points for iPhone demand.
Apple is down more than 4% on Monday after a slew of analyst reports suggested that iPhone unit sales could drop year over year as soon as the first quarter of 2019.
The report noted that Apple's directive translates to about 100,000 fewer iPhone XRs being made each day.
According to Lumentum's press release issued this morning they stated: "We recently 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", said Alan Lowe, President and CEO.
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"The legacy iPhone models forecast is likely to increase significantly thanks to more affordable prices; the total iPhone shipments in 1Q19 are likely to see a YoY decline", Kuo continued, citing Career and Nissha Printing as two suppliers that might be affected by Apple's cuts.
Following a poor forecast earlier this month, analysts and investors expressed concerned about Apple's prospects and said its smartphone sales might be stagnating.
The warning comes just a week after Japanese news service Nikkei reported that Apple asked its Chinese suppliers, including Foxconn, to halt plans for additional production lines of the XR.
Kuo last month predicted that more people would upgrade to the iPhone XR this year and that the Cupertino-based giant would sell its cheaper model better than the iPhone XS and iPhone XS Max.
Speculation from news organizations like Reuters are reporting that the company to which Lumentum is referring to is Apple. Apple also provided lukewarm guidance for the all-important holiday quarter.
The iPhone XR began shipping on October 25th and, since then, has been mired with speculation of weak sales.