Apple stock (Nasdaq: AAPL) took a hit the day after its first-quarter earnings were released, closing down more than 12 percent on Thursday. Investors were worried that growth is slowing at Apple, the world's most valuable company.
Shares of Apple dropped $63.51, or 12.35 percent, to $450.40 at the close of New York trading Thursday. The tech-heavy Nasdaq index, on which Apple trades, also closed down 0.74 percent to 3,130.
On Wednesday after the market closed, the company reported that it sold 47.8 million iPhones in the quarter, compared with 37 million in the same quarter a year ago. Many investors had hoped that the company would sell 50 million iPhones, which drives Apple's earnings.
"No technology company has ever reported these kinds of results," Tim Cook, CEO of Apple, said on the earnings call on Wednesday.
Investors eagerly awaited Apple Inc., based in Cupertino, Calif., to report its earnings, seeking clarity after a number of rumors about iPhone parts and sales.
Earlier this week there were reports about the next iPhone being released in June.
"Certainly a new product line is in the works," said Brian Colello, Morningstar senior equity analyst. "It remains to be seen what Apple will ultimately come out with and when. Those are certainly factors to keep an eye on."
Last week, a report that Apple had decreased its order for iPhone parts may have contributed to a decrease in its stock price to near $500.
"It will be interesting to see if Apple is really pushing the envelope in terms of innovation and shortening the product cycle," Colello said.
Colello said Apple is facing growing competition from Samsung. Last summer, when Apple released the iPhone 4S, Samsung also released its Galaxy S 3, which saw strong sales.
On Wednesday, Apple said it sold a "record" 22.9 million iPads in the quarter, compared to 15.4 million a year ago. The company also sold 4.1 million Mac computers, compared to 5.2 million in the same quarter last year.
On Apple's earnings call CFO Peter Oppenheimer attributed the Mac slide to the refreshed Mac products not being released until December. Its new iMac desktops were not sold until early December.
"We believe our Mac sales would have been much higher without those constraints," Oppenheimer said on the call.
Colello said the iPhone unit sales were "a bit of a disappointment."
And despite a record number of iPad sales, he said they were still lighter than Wall Street's expectations.
The company failed to beat Wall Street's expectations about revenue, but it did beat forecasts for profit. Apple's own forecast was $52 billion in revenue.
"We're thrilled with record revenue of over $54 billion and sales of over 75 million iOS devices in a single quarter," said Cook in a statement. "We're very confident in our product pipeline as we continue to focus on innovation and making the best products in the world."
In light of the company's "fairly weak" quarterly earnings, Colello said Apple's forecast for $41 billion to $43 billion in future revenue was also "light."
The company still can boast about the amount of cash it has hoarded: $137 billion.
On Tuesday, some investors had their hopes up after Verizon reported a stronger than expected number of new iPhone subscribers during its conference call.
Colello cautioned that Verizon's iPhone sales were strong but they also sold a large number of older iPhone models.
"Obviously the iPhone is the biggest driver, but there are a couple factors in there, such as the types of units and at what prices," Colello said. "Was it the Phone 5 or 4S?"
Apple does not break out the type of iPhones sold.
Joanna Stern contributed to this report.