Apple cuts production on new iPhone models2018-11-20 11:14 by Daniela
Tags: Apple, iPhone
Apple is reportedly cutting production orders for all three 2018 iPhone models, a report said Monday. It turned out that demand for the new devices — especially the iPhone XR — has been weaker than expected.
Last week, iPhone suppliers such as Qorvo Inc., Lumentum Holdings Inc. and Japan Display Inc. cut quarterly profit estimates, citing a drop in orders that had been placed previously by a large customer. Apple was not identified in the announcement, but makes up a third to half of those companies' revenue, the Journal reports, citing filings and estimates.
A lower-than-expected demand for the new iPhones and Apple’s decision to offer more models has made it more difficult to anticipate the number of components and handsets the company needs. Forecasts have been particularly problematic for iPhone XR, with Apple cutting its production plan by up to a third of the nearly 70 million units some suppliers had been asked to produce between September and February, the paper said.
Slashing the iPhone orders won’t have Apple worried. The ever-increasing ASP of its phones and the massive growth of its Services division means revenue is at an all-time high (the last Q4 was its best ever). But the company's suppliers are suffering as a result of the reduced demand.
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