“Shares of Apple Computer Inc. fell sharply on Wednesday after SigmaTel Inc., a top maker of memory chips used in digital music players, cut its outlook, citing lower-than-expected sales and price cuts,” Reuters reports. “Over the last three to four weeks, prices for NAND flash chips — the type of memory used in electronic products such as Apple’s iPod and other music players — have declined more than 30 percent and are expected to drop another 40 percent over the next several months, SigmaTel said.”
Reuters reports, “‘Management cited this pricing instability as a major factor in lower customer orders,’ wrote CIBC analyst Daniel Gelbtuch in a note to clients. The lower orders could translate into lower sales of Apple’s iPod Shuffle, which uses flash memory, analysts said. Shares of Apple were down $1.09, or 2.9 percent, to $36.22 on Nasdaq in late afternoon trade after falling as low as $36.14. Shares of SigmaTel also declined, falling 14 cents, or 0.8 percent, to $17.60 on Nasdaq.”
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