Apple, Chips Stocks Falling Amid Taiwan Semiconductor's Weak Guidance

Taiwan Semiconductor Mfg. Co. Ltd. (ADR) TSM, one of the most tracked Asia-based chip manufacturers, offered investors a poor guidance outlook that had a ripple effect across the technology sector.

What Happened

Taiwan Semiconductor manufacturers chips for companies like Apple Inc. AAPL and NVIDIA Corporation NVDA and said it's facing "weak demand" from mobile customers, CNBC reported. The company guided its revenue for the second quarter to a range of $7.8 to $7.9 billion, which is notably short of Wall Street's estimate of $8.8 billion.

The Taiwan-based company followed up in a conference call that its poor guidance is attributed to "softening" demand in the high-end smartphone market. The company also feels it necessary to take a more conservative stance in its outlook for sales related to the cryptocurrency mining industry.

Why It's Important

Taiwan Semiconductor's poor outlook is notable enough to impact many mega-cap names in the telecom and technology sector. Here is a summary of some of the stocks seeing a notable impact ahead of Thursday's market open.

• Apple down 1.4 percent.
• Nvidia down 2 percent.
• Taiwan Semiconductor is down 4.9 percent.
• Skyworks Solutions Inc SWKS down 2.8 percent.
• NXP Semiconductors NV NXPI down 2.6 percent.
• QUALCOMM, Inc. QCOM down 2.4 percent.
• Micron Technology, Inc. MU down 1.8 percent.
• Advanced Micro Devices, Inc. AMD down 1.7 percent.
• Applied Materials, Inc. AMAT down 1.7 percent.

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