Apple: The Shine Dims Thanks to Multiple Setbacks in One Week

Apple may well have had worse weeks. It would just be difficult to remember when they were.

We can take this Mayan Apocalypse thing too far, but given the five adverse developments the company has suffered in a matter of days, maybe there is a connection.

In a testament to its growing power, four of the five negative developments were based on intellectual property issues.

First, courts ruled that that two fronts of Apple's Samsung jihad had collapsed: Samsung's adaptation of a finger-based 'pinch and zoom' screen manipulation was not deemed a patent violation and, as if that were not enough, another judge ruled that an injunction against sale of Samsung phones would not be granted because infringement was not deemed to have caused irreparable harm.

Let us stipulate, for the marketing and communications record, that Apple's case was not helped by its own trumpeting of global sales results for the iPad mini and iPhone 5.

Next, companies in Brazil and Mexico, two significant and growing markets, challenged Apple's copyright of the name iPhone. The Brazilian company claimed it copyrighted the name IPHONE in 2000 and the Mexican company said it did the same thing for IFone in 2002, both well before Apple introduced the iPhone. Apple just launched sales of the iPhone 5 in both countries, so the timing and the impact of those challenges were neither coincidental nor inconsequential.

Finally - and just in case you were still determined to look at the bright side - PRIOR to any of these announcements, five securities analysts who cover Apple stock lowered their estimates for the company's prospects based on their projections which, they all claim, suggest the company's holiday sales will be disappointing and that it needs new products.

The implication is not that Apple is failing or has somehow fallen on hard times. But it does provide a warning similar to that which other tech behemoths have endured, from IBM to Microsoft to Google: that the law of large numbers matters. That growth above a certain level becomes harder and harder to achieve. And, as a result, that capital markets addicted to growth can go from best friend to worst critic if they sense that growth is not forthcoming. In addition, Apple's attempts to forestall the Android Ascendancy may not just be in vain, but a misallocation of resources and attention. JL

Adam Satariano reports in Bloomberg:

A band of Apple Inc. (AAPL)’s most bullish fans on Wall Street are growing increasingly bearish over concerns that holiday iPhone sales have been weak and that the company needs new breakthrough products to fend off rivals Google Inc. (GOOG) and Samsung Electronics Co. (005930)

At least five analysts have cut their price targets for Apple since Dec. 16, with some saying Apple’s purchases from suppliers indicate iPhone and iPad sales may not meet projections.