Apple stock dropped more than five percent after the price cut was announced Wednesday, closing at $136.76, down $7.40. In extended trading, the share price fell another $1.01.
Meanwhile, those who snapped up the iPhone before Wednesday are coping with a bitter aftertaste now that it is $200 cheaper within 10 weeks of its introduction, notes CBS News. It's a rare move, as Apple typically discounts only older products.
In an [url=http://www.usatoday.com/tech/products/2007-09-05-jobs-qanda_N.htm]interview[/url] with USA Today, Apple CEO was asked what he would say to those who just bought a new iPhone for $599 (the price has been cut to $399).
"That's technology. If they bought it this morning, they should go back to where they bought it and talk to them," he said. "If they bought it a month ago, well, that's what happens in technology.
USA Today also asked Jobs: "To do this, are you taking a hit on costs? Or have prices really come down?"
His answer: "We're in high-volume manufacturing, and we're pretty good on the costs side. We're also willing to be more aggressive. We think we have a real winner, and customers love the iPhone. The product's been extremely well accepted; we want to put the pedal to the metal. A holiday season is approaching; we'd have to wait another year for another one."
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