Apple Inc. shares fell as much as 3 percent in early trading Monday after an analyst said the iPhone maker was cutting orders from suppliers of parts for its iPad tablet.
JPMorgan Chase said in the research note out of Asia that several suppliers indicated in the past two weeks that Apple lowered fourth-quarter iPad orders 25 percent.
"Our understanding is that this is not in preparation for a new model launch," said Gokul Hariharan, JP Morgan's Asia Pacific electronic manufacturing services analyst.
The move could result in slower sales for suppliers such as Hon Hai Precision Industry Co., the analyst added.
Concerns for a slowdown in iPad tablet sales come as Amazon.com is expected to unveil its own tablet device rival on Wednesday. One analyst has already described the expected device as a "game changer" that could challenge the iPad.
Apple shares recovered slightly from earlier losses and were down about $4, or 1 percent, at $400.28 in mid-morning trading on Nasdaq.
Hariharan noted that Mark Moskowitz, JP Morgan's U.S.-based Apple analyst, does not expect the supply chain adjustments to result in downside to his estimates for iPad shipments.
Other analysts also said they would not be changing their iPad shipment estimates and that it would be difficult to accurately estimate shipment orders.
"The iPhone 5 launch is much more important than the iPad right now," said BGC Partners analyst Colin Gillis. "Could the tablet market slow down? Yes absolutely, but data from factories is notoriously unreliable especially since Apple started diversifying their supplier base."
BTIG analyst Walter Piecyk said he would be maintaining his forecasts of Apple selling 13 million iPads in the fourth quarter.
"I don't see any reason to change our estimates. We expect that iPad and iPhone production is shifting to Brazil and Apple remains the market leader that it created with the iPad," he said.
Another analyst report out of Asia over the weekend indicated that the retail outlook was that Apple remained positive on the continent with packed Apple stores in several Chinese cities.
"We anticipate continued strong earnings growth for Apple due to our checks indicating strong global demand for the iPhone and iPad," analysts at Canaccord Genuity said.
Apple did not immediately reply to a request for a comment.
© 2016 Thomson/Reuters. All rights reserved.