From Nasdaq: 2024-11-10 08:00:00

Chipmaker Cirrus Logic (NASDAQ: CRUS) has seen a significant drop in its stock price, down nearly 30% since hitting a 52-week high in August. Despite reporting strong quarterly revenue of $542 million, driven by new iPhone launches, the company’s stock fell 7% in extended trading due to lower-than-expected guidance for the next quarter.

The decline in Cirrus Logic’s stock price may be attributed to concerns about poor iPhone demand impacting its revenue. Reports suggest shorter shipping times for new iPhone models and lower pre-order numbers, leading Apple to adjust production plans. Cirrus’ revenue is expected to decline significantly, highlighting its dependency on Apple for a large portion of its revenue.

Despite short-term challenges, Cirrus Logic remains well-positioned for long-term growth. With a focus on diversifying beyond audio chips and tapping into the generative AI smartphone market, the company’s close ties with Apple could drive future success. Investors should consider the potential for a rebound in Cirrus’ stock price, especially given its current valuation of 20 times earnings.

While Cirrus Logic faces near-term headwinds, its strategic positioning and relationship with Apple suggest potential upside for investors. Monitoring developments in the generative AI smartphone market and Apple’s product offerings could provide valuable insights for those considering investing in Cirrus Logic.



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