UPDATE: JP Morgan Downgrades Audience to Neutral on Loss of iPhone 5

JP Morgan reduced its rating from Overweight to Neutral on Audience

from Overweight to Neutral and lowered its price target from $24 to $10. JP Morgan noted, "ADNC announced that Apple will probably not enable the ADNC IP in the upcoming iPhone 5, which means a loss of ~$35M in royalty revenues versus our prior 2013 forecast. Although management was not able to clearly articulate the reason for the loss, they remain confident that merchant market competitive solutions were not the problem, leading us to believe that Apple has developed its own proprietary voice enhancement/noise suppression capability and has chosen to use this architecture on the iPhone 5." Audience closed at $18.86 on Thursday.