Apple iPhone sales may miss second quarter expectations

Sales of Apple iPhones may be slowing, leading to excess capacity and some lay-offs at its key component suppliers, according to reports, which also hit the shares of suppliers including chipmaker ARM Holdings.

Some workers at Foxconn technology group, in Zhenghou, China, were laid off in the first two months of the calendar year, according to a person involved in the company's supply, the Wall Street Journal reported.

A Chinese government document also showed a provincial capital had offered Foxconn, also known as Hon Hai Precision Industries, $12m in subsidies to offset layoffs, the journal reported.

The layoffs came earlier than they usually do, ahead of the Chinese Lunar New Year holidays.

Those layoffs are likely linked to iPhone sales, analysts told the newspaper.

Cupertino, California-based Apple is known to provide its suppliers with rolling forecasts for orders months in advance so they can plan production and hiring in advance.

In October 2015, Apple boss Tim Cook predicted iPhone sales would rise during the company's first fiscal quarter, which ends in December, in comparison to a year ago, but declined to provide guidance further out.

On Tuesday, Nikkei reported Apple was expected to reduce its production of iPhone 6S and iPhone 6S Plus handsets to 30% below its previous projections during the quarter ending in March.

Shares in Apple slipped 0.45% in after-hours trading in the US to $102.25, after losing 2.51% to $102.71 during the regular session, while in London on Wednesday morning, chip supplier ARM was down more than 3% to 973p.