It can be a good or bad thing when much of a company's fortunes are tied to another company.
For Austin-based Cirrus Logic it became a very good thing on Thursday when its stock soared over 18 percent, hitting a closing price of $49.82. The chipmaker's stock had not reached those heights since September of 1995.
Cirrus Logic, which makes audio and voice chips for smartphones and other products, is a supplier to Apple Inc. In fact, it is well-known that Apple is Cirrus Logic's biggest customer, though the Austin chipmaker doesn't usually publicly acknowledge it.
Apple did better than expected in its most recent quarter, sending its shares up more than 5 percent so far this week. That alone can usually have a ripple affect on Cirrus Logic's stock.
And Cirrus Logic did pretty well in its own quarterly report this week. The company exceeded expectations on stock performance and issued higher guidance for the current quarter.
But that's not the whole story. A significant reason why investors are gobbling up Cirrus Logic stock has do to with the next iPhone.
According to several media reports, CEO Jason Rhode hinted during a conference call that one of its largest customers (probably Apple) is about to drop the headphone jack from its phone. There had been rumors for months that Apple was poised to do this.
For Cirrus, The Motley Fool writes, that means Apple will need brand-new headsets as well as phones without the headphone jack, which is "giving Cirrus two ways to dip into the rejuvenated revenue streams."
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