Several supply chain sources say that Apple is taking a “cautious” approach to production of its new iPhone models, according to the Nikkei Asian Review. It has reportedly lowered orders of new component parts by 20 percent, compared to production of last year’s models.
“Apple is quite conservative in terms of placing new orders for upcoming iPhones this year,” one source said. “For the three new models specifically, the total planned capacity could be up to 20 percent fewer than last year’s orders.”
According to Apple soothsayer and KGI Securities analyst Ming Chi-Kuo, Apple will release three new models in the fall: an updated iPhone X, a larger, 6.5 inch iPhone X Plus, and a new, more conservatively priced model, that will have an LCD screen (instead of the iPhone X’s OLED).
But all might not be going according to plan. Just last week, reports surfaced that Apple was behind on production of the LCD model. And now, it has cut production from last year’s 100 million orders to 80 million.
This winter, initial reports of iPhone X sales were disappointing, reflecting an overall decline in smartphone sales across the market. However, on Apple’s recent shareholder call, it showed that the phone sales were actually doing much better than the initial reports showed — and making Apple plenty of dough. CEO Tim Cook said that the iPhone X represented the first time that sales of the premium model outpaced the less expensive option.
But these new reports of lowered component part orders could indicate that Apple may be taking pains to avoid a “flop” narrative. Perhaps it has set its sights on more conservative sales numbers. If the new phones are a huge success, sales blowing past expectations would paint a much better picture for shareholders this time around.