Apple shares sink on US deceptive practices probe report
Shares in Apple fell more than four per cent this evening following a report that the tech firm is facing a probe in multiple US states, which allege it engages in deceptive practices.
A March document obtained by a tech watchdog group showed the Texas attorney general may sue Apple for violating the state’s deceptive trade practices law, in connection with the multi-state investigation.
The document, which was obtained by the Tech Transparency Project, did not provide additional details.
Apple has faced class-action lawsuits in the past from consumers alleging that it deceived them about slowing the performance of iPhones with aging batteries.
The company agreed to pay up to $500m to settle one such lawsuit in London earlier this year.
Apple is also facing lawsuits alleging that it knew and concealed how the “butterfly” keyboards on its Macbook laptops were prone to failure.
The report caused a wider tech sell-off on Wall Street, causing the S&P 500 to end the day more than one per cent down.
It snapped a four-day winning streak for the index, with its biggest daily percentage drop in nearly four weeks.
All three major US stock averages also lost ground, with falling stocks Apple, Microsoft and Amazon weighing the heaviest.
Apple is set to report its quarterly earnings next week, amid growing scrutiny of competition in the technology sector.
Chief executive Tim Cook will also appear before a US political committee on 27 July — alongside the bosses of Amazon, Alphabet and Facebook — to answer questions on their alleged use of market power to hurt rivals.
The companies are expected to argue that they themselves also face competition from others, and do not act unfairly towards smaller businesses.