What Are Suppliers Saying About Apple's Q4 Demand?

With Apple Inc AAPL’s Q4 earnings due out on Jan 26, JPMorgan analyst Rod Hall is looking for any clues about the strength of Apple’s quarter. In a new report, Hall looks to a pair of Apple suppliers for insight into Apple’s Q4 performance.

Knowles Corp KN, which supplies micro-acoustic solutions and other specialty iPhone components, recently announced Q4 revenue of about $310 million, the high end of its guidance range. With Apple accounting for 20 percent of Knowles’ business in 2014, those strong numbers seemed to be an early indicator of a strong Q4 for Apple.
 

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However, Apple supplier Multi-Fineline Electronix, Inc. MFLX reported preliminary Q4 revenue of only $169 million, missing the low range of its guidance. Since Apple represented 80 percent of the company’s business in Q3, the implications for Apple have now been blurred.

“While it is very tough to tell whether Apple may have seen demand weakness in the December quarter, we would guess that any weakness was minimal,” Hall concludes.

JPMorgan maintains and Overweight rating on Apple.

Disclosure: the author holds no position in the stocks mentioned.