The sharp drop comes amid concerns that high inflation and a slowing global economy will hurt demand.

Apple Inc’s stock market value fell sharply on Tuesday after last year’s steep drop and was on track to finish below $2 trillion for the first time since March 2021.

The sale comes a year after the iPhone maker became the first company to reach the $3 trillion market cap mark.

Apple’s shares fell 4 percent to $124.60 after Exane BNP Paribas analyst Jerome Ramel downgraded the company to “neutral” from “outperform,” lowering its price target from $140 to $180, according to Refinitiv Eikon.

Ramel lowered its fiscal 2023 iPhone shipment targets from 245 million to 224 million units, due to supply chain issues from manufacturer Foxconn and consumers cutting back on high-end phones.

At Apple’s current share price, the company is worth $1.98 trillion, just ahead of Microsoft Corp, which is valued at $1.78 trillion.

Underscoring investor concerns that a slowing global economy and high inflation could hurt demand for Apple devices, analysts expect the Cupertino, California-based company to experience a 1 percent drop in December quarter revenue in the coming weeks, according to Refinitiv. will report . That would be Apple’s first quarterly revenue decline since the March quarter of 2019.

“They (Apple) tend to gravitate towards the high-end consumer device customer, but even that demographic can be impacted by the high price of everything,” said Bokeh Capital Partners’ Kim Forrest.

Last year’s strong sell-off on Wall Street punished tech-related heavyweights as investors worried about rising interest rates and dumped stocks with high valuations.

The combined market capitalization of Apple, Microsoft, Inc, Alphabet Inc and Meta Platforms now accounts for about 18 percent of the S&P 500, up from a whopping 24 percent in 2020.

Even after last year’s 27 percent decline, Apple has delivered great returns for long-term shareholders. Investors who bought and owned Apple stock when co-founder Steve Jobs launched the iPhone in 2007 posted a gain of more than 4,000 percent, excluding dividends, compared to a 180 percent gain in the S&P 500 over the same period.

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