Apple will likely abandon a highly anticipated feature in its iPhone 15 Pro models, according to a report this week that hammered supplier Cirrus Logic. CRUS stock hit a three-month low and is down more than 12% for the week.
Due to unresolved technical issues, the iPhone 15 Pro and Pro Max probably won't feature solid-state buttons, TF International Securities analyst Ming-Chi Kuo wrote in a post. These buttons would have replaced the physical power and volume buttons and instead relied on haptic feedback from users.
"Investors had anticipated that the new solid-state button design would increase suppliers' revenue and profits," according to the report. "Thus, this change is particularly unfavorable for Cirrus Logic and AAC Technologies."
On today's stock market, CRUS stock was off 1.4% to 89.63. But shares are down 12.7% for the week. The report started affecting the stock Wednesday. Shares of AAC Technologies Holdings, which trade over the counter, slumped by double-digits when the report was released.
CRUS Stock: IPhone 15 Still Expected On Time
The iPhone 15 is still in the earliest stage of development, so there's still time for Apple to make some changes, according to the report.
"Based on these factors, removing solid-state buttons should have limited impact on the mass production schedule and shipments for Pro models," Kuo said.
But CRUS stock took a hit on the report. The company is Apple's exclusive supplier for a key component in the rumored solid-state buttons. AAC and Luxshare ICT supply Apple with another component, but larger Luxshare will be less affected because it has a significantly larger operating scale, Kuo said.
Representatives of Cirrus Logic, AAC and Apple didn't immediately return requests for comment from Investor's Business Daily.
Highly Rated Chip Stock
Shares of Cirrus Logic have soared this year. They broke out of a flat base with a buy point at 108.52 in late March, according to MarketSmith.com. CRUS stock later fell as much as 6.5% below that entry, putting the breakout at risk. Investors should sell when a stock falls 7%-8% below its buy point.
The news Wednesday put highly rated CRUS stock well below that buy point.
Shares have an IBD Digital Relative Strength Rating of 89, which puts them in the top 11% of all stocks when it comes to 12-month performance. CRUS stock also has a bullish Composite Rating of 95, reflecting its leading fundamental and technical measures.
Follow Allison Gatlin on Twitter at @IBD_AGatlin.
