Engadget Knocks $4 billion off Apple Market Cap on Bogus iPhone email
What a day for Apple investors. The stock started off strong today on a lot of pre-market buying, despite news that Amazon will finally start competing on sales of DRM-free music.
Then, whoops, at 11:49 AM EST Engadget posted saying that the iPhone and Leopard operating system launches would be seriously delayed. They based the story on an internal Apple email that was forwarded to them. The original post:
>>This one doesn’t bode well for Mac fans and the iPhone-hopeful: we have it on authority that as of today, the iPhone launch is being pushed back from June to… October (!), and Leopard is again seeing a delay, this time being pushed all the way back to January. Of 2008. The latest WWDC Leopard beta will still be handed out, but it looks like Apple-quality takes time, and we’re sure Jobs would remind everyone that it’s not always about “writing a check”, but just how much time are these two products really going to take?
Apple’s stock promptly tanked on massive selling, going from $107.89 to $103.42 in six minutes (11:56 - 12:02). This wiped just over $4 billion off of Apple’s market capitalization. A lot of people lost a lot of money very quickly.
Well, it turns out that the email was a hoax. In an update, Engadget said that the email was in fact sent from Apple’s internal email system, but that it was not accurate. Apple quickly notified Engadget of the error, saying “This communication is fake and did not come from Apple. Apple is on track to ship iPhone in late June and Mac OS X Leopard in October.”
By 12:22 Apple stock had mostly recovered and it ended the day down just $1.40/share, or $1.25 billion in market cap.
Let the lawsuits and criminal investigations commence (although to be clear, I do not believe Engadget will have any liability here. Apple may, if the email did originate from its servers).