Apple shares fell sharply on Tuesday, sliding 4% and becoming the biggest decliner in the Dow amid two streams of negative headlines.
First, a Nikkei Asia report said Apple has run into problems during the engineering test phase of its first foldable iPhone. The report, citing unnamed sources familiar with the matter, stated that these engineering development issues could delay mass production and push initial shipments back by months in a worst-case scenario. That article also reiterated Apple’s earlier plan, reported in January, to prioritize the first foldable iPhone alongside two non-folding flagship models with upgraded cameras and larger displays for a planned launch in the second half of 2026.
Second, App Store performance flagged for the March 2026 quarter. UBS analyst David Vogt pointed to Sensor Tower data showing approximately 7% reported growth for the App Store in the quarter, with growth on a foreign-exchange neutral basis near 5 percent, roughly in line with the December quarter.
Evercore ISI analyst Amit Daryanani added that App Store growth decelerated in March, driven in part by renewed weakness in gaming. According to the data noted by Daryanani, gaming revenues fell 1% year over year. Geographic detail in the App Store trends showed the U.S. declining 2% year over year and Japan down 3%, both reversing into negative territory, while China recorded 7% growth.
The moves in the stock came after a short run-up; Apple had gained 5% over the prior four trading days before Tuesday’s retreat. The 4% drop exceeded losses in the Nasdaq 100 on the same day.
Taken together, the reports combined a production-related technology risk around a new hardware form factor with softer-than-expected digital services growth, creating a layered investor reaction. The foldable iPhone item signals potential supply and timing volatility for a high-profile product initiative, while the App Store figures point to demand-side pressures in parts of Apple’s services business.
Market participants will likely watch two areas closely: whether Apple can resolve the engineering hurdles without materially shifting the 2026 roadmap, and whether App Store trends stabilize across major markets, especially the U.S. and Japan where year-over-year declines were reported.