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AAPL Plummets Amidst Fear of RIM Warfare

Thursday, June 26th, 2008 at 1:15 PM - by

Apple stock is down dramatically on Thursday thanks to investor fears that RIM is gearing up for a major war against Apple.

In early afternoon trading AAPL is down US$7.64 to $169.75.

On Wednesday, RIM said it plans to increase its spending on marketing by 28-30 percent in the August quarter. That's twice the expected revenue growth. Like Apple, RIM will soon release their own 3G smartphone, the BlackBerry Bold.

Samuel Wilson, an analyst with JMP securities, said that RIM seems to be "gearing up for a war with Apple."

As a result, investors are sensing an all out, debilitating smartphone war that will drag down the fortunes of all the manufacturers, Samsung, HTC and Nokia included.

The Dow Jones Industrial Average took a big hit on Thursday as Goldman Sachs told investors to unload their positions in automotive stock. Traditionally, when the stock market as a whole takes a hit, investors bail from AAPL as well, and that likely has also contributed to the steep drop of AAPL stock.

The concerns are in in spite of the fact that even the most conservative analysts who watch Apple believe that the company will double its iPhone sales in 2009 compared to 2008.

21 comments from the community.

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tethernaut said:

member since 14 Sep 2006 with 3 posts, unranked, send him a message or view his profile

Thu Jun 26, 2008 1:57 pm

Idiot investors. How many people are going to wait 2 hrs in line for a frakkin Crackberry?

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A guest said: (hide)

Thu Jun 26, 2008 2:10 pm

How stupid!

Do "investors" really think RIM can out-market Apple? Has anyone seen any advertising at all from RIM? Competition from Apple's iPhone is one of the reasons for RIM's current problems. If anything, AAPL should be strengthening on the news of RIM's poor outlook!

BTW, Apple has a war chest of over $20 billion cash compared to RIM's puny $1.6 billion. Remember Creative's "marketing war" on Apple and the iPod? What a joke. This'll have the same outcome. Good luck wasting your time and money, RIM...

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Sir Harry Flashman said:

member since 08 Feb 2007 with 792 posts, unranked, send him a message or view his profile

Thu Jun 26, 2008 2:23 pm

tethernaut wrote:
Idiot investors. How many people are going to wait 2 hrs in line for a frakkin Crackberry?

Never, the mind that putting lipstick on a pig doesn't make it an iPhone killer, the big businesses probably will want to stay with RIM.

As for me, the small business man, I make my own IT decisions. Furthermore waiting in line at the Apple Store is my social highlight of the season.

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Tiger said:

member since 17 Jun 2003 with 1018 posts, unranked, send him a message or view his profile

Thu Jun 26, 2008 2:26 pm

RIM was already bleeding users to Samsung with the CrackJack even before the iPhone launched. Can they stem that tide AND take on Apple?

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A guest said: (hide)

Thu Jun 26, 2008 2:27 pm

Debilitating war??? Are apple investors really that dumb.

Apple has so much money in the bank that an all out advertising campaign would not even make a dent in Apples bottom line. The drop in stock value today because of stupid investors is probably more than the ad campaign would cost.

Good Greef, dumb, dumb, dumb

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vasic said:

member since 09 Aug 2005 with 279 posts, unranked, send him a message or view his profile

Thu Jun 26, 2008 2:55 pm

Actually, today's drop parallels closely all the major indices. AAPL is a high growth stock and is consequently rather volatile. When markets go down, AAPL goes down more.

The only real cause for this drop is OIL. When it goes up, all else goes down.

RIMM took a 12% dive today (much more than AAPL). Based on that, I would say, investors are taking their money out of RIMM much more than out of AAPL.

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A guest said: (hide)

Thu Jun 26, 2008 2:56 pm

Typical. The stock market reminds me of a flock birds. One takes off and the whole flock panics. The iPhone is still a very small part of what Apple does (Remember the Mac and the iPod?) What possible consequence could what RIM does have on Apple's bottom line if they never sold another iPhone?

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A guest said: (hide)

Thu Jun 26, 2008 2:57 pm

Apple doesn't seem to worried....

Apple ups 2008 iPhone 3G build orders to 15 million - report

http://www.appleinsider.com/articles/08/06/26/apple_ups_2008_iphone_3g_build_orders_to_15_million_report.html

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A guest said: (hide)

Thu Jun 26, 2008 3:01 pm

FEAR...of the rimm battle. Go back to playing world of warfare!

the dow is at its lowest in two years today,bad sector news, and $ 140 oil is much more plausible.

AAPL will have its day.

Get that new commercial out already ,Steve!

Wait until the spots of people sitting on corbs in Hong Kong and the rest of the 78 countries...and then watch this stock FLY !

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A guest said: (hide)

Thu Jun 26, 2008 3:22 pm

This is a ridiculous post.

The entire stock market is in a tailspin today- there's nothing special about Apple. As of 3:15 PM, the Dow is down over 300 points, the Nasdaq is down 71. Apple is down not quite 5%; RIM is down nearly 13%.

Plenty of other stocks are down much more than Apple today - get a grip on yourselves.

Apple stock does not exist in a vacuum.

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A guest said: (hide)

Thu Jun 26, 2008 3:37 pm

So another speculator (this time a Saudi Oil Minister) says oil will go above $150/barrel. Gee, guess what? Oil goes way up. Apple market "experts" (more speculators) predict that Apple will go over $200 (at some point). Guess what? Apple rises. At least until the FUD factor in The Market kicks in. Then the experts panic, driving prices down. Speculators control the world economy now. (Now if the oil speculators would only speculate that oil would drop to $30/barrel by the middle of 2009...) --Mike

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A guest said: (hide)

Thu Jun 26, 2008 4:49 pm

Apple really doesn't like competition.

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A guest said: (hide)

Thu Jun 26, 2008 5:00 pm

Um, the stock isn't down because of the threat of RIMM, the stock is down because everything else is getting slaughtered and RIMM had a less than stellar quarter/guidance. If anything, RIMM's the one who has to worry about AAPL's new price points and competition. Not saying that AAPL should go up from here, I'm just saying that this headline is, well, false/not indicative of what the true story is.

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A guest said: (hide)

Thu Jun 26, 2008 5:16 pm

this article and headline are VERY misleading.

somehow it fails to mention that RIMM is down 13% after THEIR latest Q1 report, and Wall Street hammered their stock. plus the whole market is down today - THAT's the real news today.

sheesh... appleinsider, we expect better of you!

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mhikl said:

member since 20 Aug 2003 with 15 posts, unranked, send him a message or view his profile

Thu Jun 26, 2008 6:40 pm

The drop is just part of the speculator's favourite game. Dump stock so it drops. Then buy it back at a price lower than you sold it. It's just a matter of a sharp eye to events that could stir up the market. Great trick when things are not charging ahead as you like.

Cheers,

mhikl

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A guest said: (hide)

Thu Jun 26, 2008 8:07 pm

I read an article posted in Fortune on Supply Chain info on Apple's iPhone...shows 15 million 3G and 2 million 2G phones have been ordered...further iPod orders appeared to have been increased by 20% and computer products...Apple's "Bread and Butter" by 10 to 20%...

http://apple20.blogs.fortune.cnn.com/2008/06/26/supply-chain-report-15-million-iphone-3gs-forecast-for-2008/

All of which points out two things...Apple expects higher than forecast sales and that unlike RIM and PALM...it offers more than one product in more than one market...and according to Apple only 5% of their current revenue is derived from the iPhone...not 80 to 90% like RIM (the remainder is in service charges)...

Most importantly the Halo effect of a great iPhone experience should lead to sales of other Apple products globally...even though it hurts today and maybe the next few days represent buying opportunities just like on June 13th when it hit $165 and back in March when it hit $117...knowing what you know now...wouldn't you love to be able to load up on Apple at those prices? I think when Apple tops 200 or even 300 in the future you will look back to June 08 and say...why didn't I load up at the lows...so watch the candles and buy after the reversal is confirmed...

Jim, Clovis Ca

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A guest said: (hide)

Thu Jun 26, 2008 9:03 pm

What a poor excuse for a post. Oil reaches 140 and the whole market drops and you say it's due to fear of RIMM? You should remove this fabrication disguised as "news"

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A guest said: (hide)

Thu Jun 26, 2008 9:31 pm

It's not a war between Apple & RIM that's causing both stocks to go down. It's obvious that a big institutional investor is splitting a lot of money between RIM & Apple and it's betting that both

companies will perform in a samiliar manner and thus the almost equal swings in both stocks.

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A guest said: (hide)

Thu Jun 26, 2008 9:34 pm

And if the street thinks RIM has it bad this quarter; boy are they in for a shocker the next two quarters!

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A guest said: (hide)

Thu Jun 26, 2008 10:39 pm

The new iPhone is going to crush the backberry. The only thing it's got going for it is it's keyboard, it will never be able to catch up to the OS and apps that are going to be available next month. This is just a buying opportunity, this is the year of the iPhone. Just like the iPod, pretty soon you won't know anyone who doesn't own one.

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iJack said:

member since 13 Jun 2001 with 313 posts, unranked, send him a message or view his profile

Fri Jun 27, 2008 12:15 am

This is rubbish. The whole market tanked today, not just APPL.

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