Apple Plummets After Foxconn Hiring Freeze
Shares of Apple (NASDAQ: AAPL) are trading down roughly one percent this morning after Foxconn, the company's chief manufacturer, announced that it will not hire any new employees this month.
According to Bloomberg, the hiring freeze was caused by an influx of employees that returned after the Chinese New Year break. More people came back to work than in previous years, providing Foxconn with too many employees.
Investors were initially startled by the news and caused Apple to drop 1.9 percent. Shares have rebounded slightly after the realization that this hiring freeze may be cyclical. Foxconn told Bloomberg that it will begin recruiting again at the end of March. The company also claims that the hiring freeze has nothing to do with production of the iPhone 5, shooting down rumors that production was slowing down.
Even if Apple completely recovers from today's loss, the stock may still continue to struggle. The Mac maker is one of the most troubled companies on Wall Street this year, dropping more than 16 percent year-to-date.
Comparatively, Microsoft (NASDAQ: MSFT) is up more than 1.5 percent, Oracle (NASDAQ: ORCL) is up two percent, Amazon (NASDAQ: AMZN) is up nearly five percent and Google (NASDAQ: GOOG) is up 11.5 percent year-to-date.
BlackBerry (NASDAQ: BBRY), still widely considered to be one of the hottest stocks in technology, is up more than 22 percent year-to-date. Dell (NASDAQ: DELL) is performing even better, rising nearly 30 percent since the year began.
On the other end of the spectrum, investors will find Nokia (NYSE: NOK), which is down more than four percent year-to-date.
This is not the first time that Foxconn has triggered a response from investors. Last year the manufacturer sparked some controversy when it was revealed that a riot halted production at one of its plants. The plant was reopened within 48 hours but many feared that it could cause a delay in production of the iPhone 5, Apple's latest smartphone.
Production issues -- due to component supplies, consumer demand and other issues -- represent one of the biggest concerns for investors. If anything stops a record-breaking number of iPhones and iPads from hitting store shelves every quarter, investors worry that it could be a sign that the company is losing its advantage at retail.
Regardless of these concerns, the company continues to post record-breaking results, satisfying all but the harshest analysts -- and the most worried investors.
Follow me @LouisBedigianBZ
© 2015 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.