However, Apple ending the relationship in its "i-Devices" leaves many questions as to the value of Audience's technology.

The first and obvious question is: If Apple, which unlike any other company values the user experience, no longer sees the need to further the Audience relationship, will other companies see Audience's technology as a viable solution in their smartphones and tablets?

This opens several doors to competitors of Audience, and even Qualcomm ( QCOM), which does not directly compete. But Qualcomm has similar technology that does noise suppression in a software platform.

In other words, although Audience's third-quarter and possibly its fourth-quarter numbers may not reflect Apple's defection, it is certain to be a major blow going forward and the impact will be felt likely in the first two quarters of 2013.

On the other hand, current investors may find comfort in knowing that Audience still has major relationships with both Samsung and Google ( GOOG).

Still the challenge for the company is trying to convince new and existing customers why its technology deserves slots in their hardware. After all, if having Siri, which relies of voice quality and noise suppression, could not keep Apple interested, it might be quite a challenge going forward.

Bottom Line

Since reaching a low of $5.51 the shares of Audience have rebounded nicely by over 42%. Investors want to know if the stock has reached bottom.

Though the shares look cheap, I worry the adverse impact of Apple's lost relationship might not be over. The recent stock rebound is nothing more than a knee-jerk reaction to what was an overreaction. Staying on the sidelines still looks like the best play.

At the time of publication, the author had a position in AAPL.

This article was written by an independent contributor, separate from TheStreet's regular news coverage.
Richard Saintvilus is a private investor with an information technology and engineering background and has been investing and trading for over 15 years. He employs conservative strategies in assessing equities and appraising value while minimizing downside risk. His decisions are based in part on management, growth prospects, return on equity and price-to-earnings as well as macroeconomic factors. He is an investor who seeks opportunities whether on the long or short side and believes in changing positions as information changes.

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