Weak iPhone sales hit shares of Europe's Apple suppliers

Shares of European suppliers of microchips, sensors and circuitry to Apple fell on Wednesday after the smartphone company's much-awaited iPhone sales missed expectations in the second quarter.

Suppliers rely on strong iPhone sales for part of their profits, and in some cases Apple's announcement on Tuesday reawakened concerns about excessive exposure to Apple.

Shares in Dialog Semiconductor, which provides power management systems for Apple, fell 3 percent, among the top European fallers on the day.

The company has been in investors' focus since mid-April when a research note from German broker Bankhaus Lampe suggested Apple could be developing the capacity to bring its power management components in-house.

That report knocked as much as a quarter off of Dialog's market value on the day. The company gets nearly 75 percent of its revenue from Apple, according to Morgan Stanley estimates.

Imagination Technologies, a British designer of graphical processing units used in smartphones, was down 0.5 percent. In April it said Apple, its largest customer, would stop using its technology within 15 to 24 months, causing its stock to lose nearly two thirds of its value in a single day.

Swiss company AMS, the maker of optical sensors for iPhones, dropped 2.1 percent and Italy's STMicro, which provides the phone's accelerometers, gyroscopes and motion sensors, fell 1.7 percent.

Shares in ASML, Europe's largest supplier to computer chip makers, fell 0.6 percent. The Netherlands-listed company is lower down the Apple supply chain than Dialog and STMicro, supplying to Taiwan Semiconductor Manufacturing Company which in turn serves Apple.

Apple said on Tuesday it sold 50.76 million iPhones in the quarter ended April 1, down from 51.19 million a year earlier, indicating that customers may have held back purchases in anticipation of its 10th anniversary edition..

Analysts on average had estimated iPhone sales of 52.27 million, according to financial data and analytics firm FactSet.