Shares of Shutterfly Inc and American Greetings Corp dropped on Tuesday after Apple Inc unveiled a new greeting card application.

The new app lets users design greeting cards on iPods, iPhones or iPads. Apple will then print and mail the cards for $2.99 in the U.S. and $4.99 outside the U.S.

Shares of Shutterfly, an online photo company, declined 12 percent to $35.42 in afternoon trading, while American Greetings, a leading card company, lost 6.8 percent to $16.51.

(Reporting by Alistair Barr; editing by John Wallace)