Apple has reduced production orders in recent weeks for all three 2018 iPhone models, a report said Monday.
Apple has cut production orders on its three latest models of the iPhone, which haven’t sold as quickly as the company had originally expected, the Wall Street Journal reports, citing unnamed sources.
Production requirements reportedly were thrown off by low demand among consumers and by Apple’s decision to offer three new models — the Cupertino company had released two models each year until 2017.
According to the report, “Lower-than-expected demand for Apple Inc.’s new iPhones and the company’s decision to offer more models have created turmoil along its supply chain and made it harder to predict the number of components and handsets it needs, people familiar with the situation say.”
Lower-than-expected demand has hit the iPhone XR particularly hard, causing Apple to slash its production plan by up to a third of about 70 million units in late October, people familiar with the matter told the Journal.
Over the last week, the company told several suppliers to cut its production plan for the iPhone XR again.
Share prices for many of Apple’s suppliers including Lumentum, Oclaro, Cirrus Logic, and Broadcom significantly dropped over the past week, as well. For its part, 3D sensing technology provider Lumentum slashed its forecast for the second quarter of 2019 after a major customer requested to cut shipments, though that client was not named.
Other suppliers reportedly affected by Apple’s production cutback include Qorvo and Japan Display, which slashed their quarterly estimates last week, and Foxconn Technology which reduced overtime hours for workers, leading to earlier employee departures.