I'm starting to wonder how many people are taking advantage of the Internet age, and the volatility around anything to do with Apple, to make some money.
Apple's stock fell $9.71, or 6.87 percent, to $131.72 during today's trading on the Nasdaq. The stock was up early in the morning, but started to fall around mid-morning Eastern time, apparently after rumors started flying that Apple was cutting its iPhone production goals in half.
At around 12:30 pm in New York, TheStreet.com came out with a report saying that financial analyst firm Miller Tabak had issued a note from its stock-trading desk about the rumored production cut, which would have involved Apple slicing iPhone production from 9 million units to 4.5 million units.
Put aside for the moment the notion that Apple would have once planned to make 9 million iPhones this year, when the company has said it doesn't expect sell 10 million a year until 2008. AppleInsider reported that Miller Tabak's Peter Boockvar denied his firm issued a note on Tuesday. I contacted Boockvar myself to confirm, and he said that not only did the firm not issue any kind of note about Apple, it doesn't even track the technology sector.
CNBC reported that Boockvar told TheStreet.com's Scott Moritz that he had merely heard the same rumors about iPhone production cuts that Moritz had. But Moritz attributed the rumors to a note supposedly issued by Miller Tabak citing talk at Goldman Sachs, although he later scrubbed references to Goldman Sachs from his online report without noting their removal.
Boockvar said he planned to ask TheStreet.com for a retraction, although the story was still up as of this writing. The episode is eerily reminiscent of Engadget's blunder earlier this year, when it was duped by a fake internal e-mail into thinking that Apple had postponed the launch of the iPhone until October. At least in that case, however, Engadget quickly updated its post while the market was still in session, and the stock regained most its value quickly.
And to be clear, Apple's stock price also benefits from rumors, such as the ones that next Tuesday's Mac event will see the introduction of new iMacs. But still, you have to wonder where these rumors start. I bet TheStreet.com's Jim Cramer has some theories.
Millions of people, from hardcore computer geeks to high-finance Wall Street martini drinkers, hang on every word related to Apple. Sometimes, that can have consequences.
A midday plunge in Apple's stock was caused by an Engadget report based on a fake internal memo at Apple.
(Credit: Financialcontent.com)Engadget posted a story Wednesday morning at 11:49am ET claiming that Apple was about to announce another delay of Leopard, the next version of Mac OS X, as well as a delay for the iPhone, perhaps the most hyped gadget of all time.
"This one doesn't bode well for Mac fans and the iPhone-hopeful: we have it on authority that as of today, the iPhone launch is being pushed back from June to... October (!), and Leopard is again seeing a delay, this time being pushed all the way back to January," Engadget said. Panic ensued. Apple's stock immediately plunged 2.2 percent as investors contemplated another product delay at Apple, following the first Leopard delay as well as the Apple TV delay in February.
But around 20 minutes after the original post, Engadget started to update its story. First, the site said it had heard back from Apple PR that there was no delay. Then the full story started to emerge.
Apparently an internal memo was sent to several Apple employees--and forwarded to Engadget--around 9am CT today saying that Apple issued a press release with the news that the iPhone was now scheduled for October, and Leopard was delayed until January. About an hour and a half after that e-mail went out, a second e-mail was sent--this time officially from Apple--saying the first e-mail was a fake, and that the delivery schedule for the iPhone and Leopard had not changed. Engadget then updated its headline as "False alarm: iPhone delayed until October, Leopard delayed again until January.
Commenters on Engadget and Apple investor boards were not amused. Many of those comments are not printable in this space, but it's safe to say that there's some very unhappy Apple shareholders out there today. Apple's stock recovered as the full story emerged, but was still down slightly in afternoon trading.
Engadget said that the e-mail was forwarded by "a trustworthy source," and definitely sent from within Apple's internal e-mail system. "Presumably Apple is now on the hunt for whomever was able to spoof its internal email system," it said in a later version of the post that used a strikethrough font effect on the text of the original report.
UPDATED: An Apple representative confirmed that there has been no change in the company's schedule for both Leopard and the iPhone. "The communication is a fake and did not come from Apple," the representative said.
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