Apple (NASDAQ:AAPL) shares fell below $600, a drop of almost 15% from mid-September, when they topped $700, after the company disappointed its customers by launching a mapping service with big problems and the departure of executives showed divergent opinions among management.
The decline started shortly after Apple’s Maps application came to be strongly criticized after the launch of iPhone 5 on September 21, writes MarketWatch portal.
One week later, Jean-Louis Gassée, former executive at Apple between 1981 and 1990, who has become in the meantime an investor in new IT projects, wrote that the iPhone maker has lost nearly $30 billion in market capitalization as a result of maps failure.
Apple CEO, Tim Cook, was even forced to apologize for the problems and recommend similar services to clients from rivals such as Google.
Apple shares have continued to decline in October, and the last drop was recorded on Wednesday, after the trading resumed on U.S. exchanges, stopped two days because of Hurricane Sandy. Apple shares fell by 1.5% in response to the biggest management restructuring in recent years, after which Scott Forstall, senior vice president of iOS Software left the company. Forstall was the protege of co-founder and former CEO Steve Jobs who died in October 2011.
While analysts have tried to reassure investors that all is well at Apple, there is growing uncertainty about changes in the post-Jobs era.
“The void left by Jobs was not filled and a dispute arose. Now first corpses are thrown overboard. Others will follow because Cook doesn’t have the ability to lead a company that needs a creative and dynamic leader,” said Stephen Diamond, an associate professor of law at Santa Clara University.
This view is, however, in minority. Wall Street Journal wrote that under Cook leadership, the company is run “with more peace than at the time of Jobs, when employees were living with the fear that they will fall victim to Jobs tirades or his whims.” The recent change of management demonstrates Cook’s determination to resolve personal conflicts that Jobs has allowed to rise.
Some analysts had a similar view of the U.S. daily and maintained buy recommendations on stocks, despite the unexpected departures.
Anxiety on Wall Street is growing and Forstall’s departure could be an important signal for many investors already wary of the maker of mobile devices.
The launch of the Ipad Mini and the recent advertising campaign were not as well organized as in the days of Steve Jobs, says Rob Enderle, principal analyst at Enderle Group. “They made Apple buyer look stupid. You never make your clients look stupid,” said Enderle.
The greatest fear is however the possible loss of leadership in terms of innovation. Some analysts believe that Microsoft has topped Apple by switching to a touchscreen Windows operating system, notes MarketWatch.
Reply