Should Apple be worried by what 3M said about smartphones?

A little insight into the smartphone market, ahead of Apple Inc.’s earnings report due out on Thursday, came from what many may see as an unlikely source — N95 face masks, Post-it Notes and Scotch tape maker 3M Co.:

‘Our electronics-related business was down 1{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9}, with strong growth in semiconductor, factory automation and data center, which was offset by continued softness in consumer electronics, particularly smartphones.’

— Nick Gangestad, 3M’s chief financial officer, according to a FactSet transcript

makes Ultra Clear screen protectors, Command clear smartphone stations, the Peltor WS-CUSH wireless earmuff and noise-canceling microphone for smartphones, DBI-SALA adjusted cellphone holsters, and WorkTunes hearing protectors and speakers for smartphones.

3M’s electronics business isn’t that big. It is just part of the company’s transportation and electronics business segment, which saw second-quarter sales fall 20.9{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9} from a year ago to $1.9 billion to miss the consensus forecast of $2 billion. The segment’s sales represented 27.0{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9} of 3M’s total sales of $7.18 billion.

Don’t miss:3M’s stock sinks as increase in N95 face mask demand wasn’t enough to deliver and earnings beat.

Although Apple
has been trying to de-emphasize its smartphone business, it still generated $28.96 billion in sales during Apple’s second fiscal quarter, which ended March 28, or 49.7{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9} of total revenue of $58.31 billion.

Apple is scheduled to report its third-quarter results after Thursday’s closing bell. The FactSet consensus for iPhone sales is $22.2 billion, or 42.6{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9} of expected total revenue of $52.13 billion.

Also read:Closed Apple Stores could change iPhone buying habits, but there’s reason for hope amid the pandemic.

3M’s stock dropped 4.9{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9} on Tuesday to $155.33, while Apple shares shed 1.6{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9} to $373.01{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9}. So far this year, 3M’s stock has declined 12{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9}, while Apple shares have gained 27{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9} and the Dow Jones Industrial Average
has slipped 7.6{cb3fe4c54de06d7c4b8dceae281fb32e521027d1659af7adec2f427d2f5333d9}.

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