Apple Sinks on iPhone Cutback Talk

Updated from 12:33 p.m. EDT with new stock price

Another round of rumors is taking the shine off Apple's (AAPL Quote - Cramer on AAPL - Stock Picks) iPhone.

Apple shares took a 3.5% dip Tuesday to $136.47 amid speculation about a cut in production of the trendy iPod-inspired phone. The chatter that sent the stock down was that Apple was reducing its production of iPhones from "9 million units to 4.5 million units," according to a note from the stock trading desk at Miller Tabak & Co.

The trading note, issued in an attempt to explain why Apple shares were down in heavy volume despite a lack of apparent news, cites talk on Wall Street and also points to speculation that the cuts may be coming in iPod production.

Apple didn't immediately return calls seeking comment.

The news comes a day after Verizon (VZ Quote - Cramer on VZ - Stock Picks) reported that there was an initial surge in customer defections to rival AT&T's (T Quote - Cramer on T - Stock Picks) during the iPhone introduction, but the following weeks saw a return to normal. Verizon says it is now signing up two customers to every one it loses.

Want more? Check out TheStreet.com TV video. Scott Moritz tackles the iPhone rumors driving down Apple's stock.

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