Apple share price: iCloud hack and Samsung derail iPhone 6 hype sending shares down after six months of steady gains
Ahead of Tuesday’s big launch event- said to be the unveiling of the latest iPhone 6 according to, well, everyone- Apple’s rising share price was derailed this week, as was its well-orchestrated hype-machine.
On Tuesday shares hit a record high, even as the leaking of nude pictures of celebrities began to increase the focus on its iCloud security with talk of an “iBrute” attack. A swift rebuttal was issued blaming a targeted attack in which hackers guessed login details, allaying fears over security- reassuring investors and users.
A day later, shares plummeted four per cent however, their biggest drop since January and taking it below the $100 mark which it first surpassed in August.
What happened?
Apple’s highly orchestrated efforts at building hype, largely seen as the best in the business, had succeeded in bumping up the value of Apple stock over the last six months- until now.
The share price has seen a healthy uptick since April as rumours and leaks about the iPhone 6 and so-called iWatch have been drip fed to hungry journalists, becoming increasingly detailed.
Leaks about production plans, parts, software and shapes culminated in a fully-formed iPhone 6 appearing in a YouTube video on Monday- a week before its event is due to take place.
Last six months
Samsung laid a prize blow against its rival on Wednesday however, with its own launch event at IFA in Berlin where it unveiled four new devices, stealing Apple’s thunder somewhat.
The Korean electronics company revealed it’s fifth smartwatch five days before Apple even gets its first out the door. It also announced two different smartphones with people-pleasing big screens both larger than even Apple’s soon-to-launch biggest ever iPhone.
That might have something to do with Apple’s fall.
Last week's fall
An analyst note could also be to blame. Pacific Crest’s Andy Hargreaves warned “unless next week’s event details massive incremental profit opportunities, we are likely to downgrade Apple’s rating.”
The initial lack of worry investors had over security may have also started to grow.
A major feature of the iPhone 6 is likely to be mobile payments. Apple has partnered with some of the biggest payment companies in the world- Visa, Mastercard and Amex- and built in NFC technology making it possible to swipe a phone to pay.
A security issue in this context makes it a much larger issue. If hackers are able to steal pictures from iCloud, will customers trust Apple with their money?
It’s telling that Apple boss Tim Cook was forced to respond personally to these concerns on Friday, saying it would up security features for iCloud, when the company is more used to issuing a “no comment” over such things.
Compared with the launch of previous iPhones, that’s an unwelcome pre-launch fall in share price and one that will be difficult to turn around and return to last week's record high ahead of Tuesday's big event.