Two corporate earnings reports are indicating softer demand in the mobile and wireless sector. Juniper said late yesterday that third quarter earnings will come in below expectations, and blamed weaker orders from service providers.
“The release identified weakness from service providers, particularly in the U.S. as the primary source of weakness,” said analyst Simon Leopold of Raymond James. Juniper sells routers and other networking gear to cable operators as well as wireless service providers, and has referenced industry consolidation as a concern.
Meanwhile mobile device makers may also be looking at a slowdown in orders. The latest sign is today’s selloff in the semiconductor sector: Qualcomm, ARM Holdings, Intel, MediaTek and Broadcom all sold off sharply on Friday morning after diversified chipmaker Microchip Technology warned of a coming correction in the chip market.
With mobile device penetration approaching or surpassing 100% in many markets, some analysts are trimming projections. Earlier this year, IDC trimmed its overall forecast for IT spending based partly on an expectation of weaker mobile device sales.
Gartner, meanwhile, is calling for an uptick in mobile device sales next year: 4.1% growth in 2015 versus 3.1% growth this year.
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