Updated from 9:28 a.m. EDT
San Jose, Calif.-based PortalPlayer said Apple took a raincheck on the follow-on to its PP5021 System-on-Chip. PortalPlayer said the product is expected to be ready in the second half of 2006 but that Apple won't use it in midrange and high-end flash-based iPods.
PortalPlayer said it believes that the PP5021 will continue to be used in other members of the iPod family.By Thursday afternoon, PortalPlayer dropped $9.42 to $13.17. Meanwhile, Sigmatel (SGTL), a rival flash memory supplier to Apple's iPod line, was up 44 cents, or 5%, to $9.04.