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Apple Slashes iPhone 5 Part Orders Due to Weak Demand
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Nice find. Here's another:
![fbc3589c_image.jpeg]()
Ah, Henry Blodget. The only difference between this criminal and the other members of the media is he was caught and held accountable when he was in private industry, and then of course he moved on to a career in the media, where he fit right in right away:
http://en.wikipedia.org/wiki/Henry_Blodget
"Henry Blodget (born 1966) is an American former equity research analyst who was senior Internet analyst for CIBC Oppenheimer during the dot-com bubble and the head of the global Internet research team at Merrill Lynch. Blodget is now the editor and CEO of The Business Insider, a business news and analysis site, and a host of Yahoo Daily Ticker, a finance show on Yahoo."
"In 2003, he was charged with civil securities fraud by the U.S. Securities and Exchange Commission.[6] He agreed to a permanent ban from the securities industry and paid a $2 million fine plus a $2 million disgorgement."
Sure. It still happens though. And it isn't necessarily the exact people doing the announcement and those doing the trades.
This report is a load of crap. Notice how NONE of the analysts have announced that they have reduced their positions in AAPL.
So let's say you're Tim Cook and it's Sept 2012. You're looking ahead at the Oct-Dec quarter, and you're saying,
Hmm, we've got a pretty good product we're about to release and we're expanding into more countries than ever before. Last year we sold 37 million iPhone 4S's. This year, I think we'll come pretty close to 50 million, if not more. But let's place orders for 60 million just in case we run into QC issues or the demand just completely surpasses our expectations.
Fast foward to December.
Hmm, okay we made our 50 million mark like we thought, but now we have 10 million+ extra parts. In Jan-Mar, we'll probably "only" sell 30-40 million phones. We already have 10 million, so now we need to cut our orders from 60 million down to...30-40 million.
Now, some random rumor monger in Japan finds out that orders got cut from 60 million parts in Oct-Dec to 30-40 million parts in Jan-Mar. That's nearly a 50% cut. For a company like Apple, that catches people's attention so he reports it WSJ. For media organization like WSJ, this kind of information is like hot gossip. They just HAVE to tell everyone about it like it actually means something. And yet, if you go back to look at what it means for iPhone sales or demand, it means absolutely nothing.
The exact same thing happened last year with the iPhone 4S, except the order cuts rumors came out a little earlier in November. And we all know what ACTUALLY happened when the January sales figures came out.
The whole key for Apple is to maintain an inventory balance. They need to overshoot in the first quarter to be able to meet demand. After that, they cut in order to minimize excess inventory. The parts order cut is completely natural and EVERY tech company will cut their parts after Christmas.
So let's say you're Tim Cook and it's Sept 2012. You're looking ahead at the Oct-Dec quarter, and you're saying,
Hmm, we've got a pretty good product we're about to release and we're expanding into more countries than ever before. Last year we sold 37 million iPhone 4S's. This year, I think we'll come pretty close to 50 million, if not more. But let's place orders for 60 million just in case we run into QC issues or the demand just completely surpasses our expectations.
Fast foward to December.
Hmm, okay we made our 50 million mark like we thought, but now we have 10 million+ extra parts. In Jan-Mar, we'll probably "only" sell 30-40 million phones. We already have 10 million, so now we need to cut our orders from 60 million down to...30-40 million.
Now, some random rumor monger in Japan finds out that orders got cut from 60 million parts in Oct-Dec to 30-40 million parts in Jan-Mar. That's nearly a 50% cut. For a company like Apple, that catches people's attention so he reports it WSJ. For media organization like WSJ, this kind of information is like hot gossip. They just HAVE to tell everyone about it like it actually means something. And yet, if you go back to look at what it means for iPhone sales or demand, it means absolutely nothing.
The exact same thing happened last year with the iPhone 4S, except the order cuts rumors came out a little earlier in November. And we all know what ACTUALLY happened when the January sales figures came out.
The whole key for Apple is to maintain an inventory balance. They need to overshoot in the first quarter to be able to meet demand. After that, they cut in order to minimize excess inventory. The parts order cut is completely natural and EVERY tech company will cut their parts after Christmas.
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sometimes it makes sense to cut your losses and move on...i'm not saying apple won't rebound eventually, but for the time being, there might be a better investment opportunity.
![A7BGNcjCMAEZkI2.png:large]()
I've been saving this for a while (since Oct 26) . Dude has lost $5,544 by my count.
Do you even understand that it's not a real loss unless he sells? (Same thing for people with unrealized gains, of course.)
Do you even understand that over a year ago, Apple peaked around $644, dropped to the $520's, and then went up to $700, before dropping to the current level of $500 in the face of an even more relentless and reckless daily bashing cycle perpetrated by the media?
Do you even understand that besides the extraordinary amount of money Apple consistently makes, the other really unusual thing about Apple is all the press it gets? Lots of stocks have been yo-yo'ing over wide ranges from month to month, from JOY to PCLN to GOOG to WDC. The worst thing you could have done in the last six months is sell those stocks at up to a 30% loss (maybe even more), which anyone who bought at the "wrong" time over that period could easily have done.
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iPhone 5 was and still is an underwhelming update to the 4s. There was nothing about it that made me want to upgrade my 4s.
Haven't updated my phone since the iPhone 4. And I don't feel like doing it at all with the current offerings. Nothing that wows me too much. iPhones are WAY too expensive without a contract - and for me they are not worth the price, since all I've been using my phone for is music and calls. Nothing more. I'd rather spend cash on updating my ipad 3 or nexus 7, or a full size computer. If the iphone were a bit cheaper + SD card, then maybe. If not, when my current iphone 4 dies, it will probably be an android.
Actually, it is a real loss. He had $40,000 worth of capital, now he has $35,000. Oh, you think because it's just stock it's not real money... Okay, how is this not like if you have $40k in the bank and inflation robs you of 14% of its value--it's a real loss. If I bought $35k of Apple stock today and spent the other $5,000 on cheese I would have an equal amount of stock as this person, and $5000 worth of cheese. If he didn't lose anything, how is this cheese possible? This is made worse by the fact that inflation is likely at 4% right now, so in the past 3 months that's another 1% of loss. My cheese might gain more value than that!
And you're right, I'm sure it will get up to 700 again one day. Now whether it rises by 3%/year or 10%/year, that's the only real question. It's been the contention of many that Apple was overvalued, not worthless. Yes, Apple makes a ton of profit, but it also does not give dividends and people buy the stock way past what the projected profit is. If Apple is expected to make 10 billion dollars profit, fanboys bid up the stock like it's going to make 20 billion, and it only makes 11, the fanboys who are late to the party lose. Do you not even understand?
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Anyway, this isn't really surprising, iOS6 is partly to blame as is Apples utterly dumb move to drop Google Maps, it is a shame as the A6 is a great SOC, but maybe people are tired of Apple's BS marketing now? Or are getting iPads and Android smartphones.
Maybe it's the constant legal battles catching the main news headlines all the time. I also think Apple will find it harder this year as the new PS4 and the new Xbox are being heavily rumoured for release in time for Christmas and I bet many would have one of those over an iPad!
Maybe it's the constant legal battles catching the main news headlines all the time. I also think Apple will find it harder this year as the new PS4 and the new Xbox are being heavily rumoured for release in time for Christmas and I bet many would have one of those over an iPad!
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This is, by far, one of the more intelligent statements on this thread. This whole subject has been a barrel of laughs all day...I have been entertained by the many self proclaimed financial analysts on macrumors!
Classic...just classic. Many of you keep throwing percentages put there about this and that, well here's one for you; I'd be willing to bet that 99% of the people on this site that claim they are going to do one thing or the other with their Apple stock DON'T OWN A SINGLE SHARE!
However, go ahead, I'm enjoying the Suze Orman/Jim Cramer sound alike contest!!
Exactly. It's just a phone not a museum piece.
Personally, as long as the screen doesn't get scratched I don't mind a few knicks and scraps on my phone (and by many accounts the iPhone 5 comes per scuffed, so job done
)I don't understand people who baby their apple products, they buy special covers and keyboard protectors for their MacBooks. Maybe these people should keep them in the box and just put on some white gloves to touch them sometimes.
Felt if the screen was actually bigger maybe like 4.3 or 4.5 inch compared to a 4 inch increase, the iPhone 5 would have been a lot more appealing.
If Apple only does colors and some minor specs bumps for the iPhone 5S, being are still going to buy it (because its an Apple product) but I could defiantly see Apple taking a beating from Apple users, the market and press, as well as from competitors.
Apple is quite behind in terms of services and since they ditched Google Maps, its just going to be harder. iCloud, Siri, and Maps services all need to be improved. iOS is also the oldest iOS now and while it works, its flawed in many ways with designs and UIs that no longer make sense 5 years later or are not easy to use at all.
jon3543...umm, not the sharpest tool in the shed, to say the least. Again, another classic financial lecture from the "play like I own loads of AAPL"!Actually, it is a real loss. He had $40,000 worth of capital, now he has $35,000. Oh, you think because it's just stock it's not real money... Okay, how is this not like if you have $40k in the bank and inflation robs you of 14% of its value--it's a real loss. If I bought $35k of Apple stock today and spent the other $5,000 on cheese I would have an equal amount of stock as this person, and $5000 worth of cheese. If he didn't lose anything, how is this cheese possible? This is made worse by the fact that inflation is likely at 4% right now, so in the past 3 months that's another 1% of loss. My cheese might gain more value than that!
And you're right, I'm sure it will get up to 700 again one day. Now whether it rises by 3%/year or 10%/year, that's the only real question. It's been the contention of many that Apple was overvalued, not worthless. Yes, Apple makes a ton of profit, but it also does not give dividends and people buy the stock way past what the projected profit is. If Apple is expected to make 10 billion dollars profit, fanboys bid up the stock like it's going to make 20 billion, and it only makes 11, the fanboys who are late to the party lose. Do you not even understand?
This might be as good of a time as any to bitch about the totally ****** Apple ads of late.
When your stiffest competition is putting out stuff like this:
http://www.youtube.com/watch?v=xY_MUB8adEQ
And Apple is putting out this:
http://www.youtube.com/watch?v=vM9U70HgLsQ
It's time to think outside the box.
When your stiffest competition is putting out stuff like this:
http://www.youtube.com/watch?v=xY_MUB8adEQ
And Apple is putting out this:
http://www.youtube.com/watch?v=vM9U70HgLsQ
It's time to think outside the box.
Lol at the people acting like Apple is here to specifically compete with other people. Sure they sue a lot but in the end it is about the money. They were always the expensive tech company, not the budget everyman company
I know alot of people upset at Apple due to, seems like they come out with iPhone 3, 3S 4 4s and now a iPhone 5 than the 5s. Can't they see what going on, they pushing people away from their company.I know many have left Apple do to this and went with Samsung phones. Plus the iPhones and other Apple products are way over priced.
Are you for real? I responded to this: "it's a PHONE."
I didn't respond to "it's a smart phone," "it's a phone that is smart" or any other combination of smart plus phone. Just "it's a PHONE" (caps and all). Do You get it now?
Mike
Hi its Tim,
Just wanted to send a shout out to all you mac rumor posters,
Your input has been so valuable to help us make better decisions in the future.
Boy did we blow it with the iPhone 5 we thought releasing a phone that was lighter, stronger , faster especially when compared to Samsungs latest offerings (see andantech processor ratings) better headphones would have sold much better. Actually we thought it was selling pretty good better than any previous model we have made, thank god for that WSJ article I guess our internal numbers were all wrong! I am so lucky to be able to get advise from all you folks at MacRumors with your extensive experience and knowledge running fortune 500 companies similar to ours the largest in the world.
Wow! I have been blind to our lack of innovation until i read this site thank you so much, again.
I thought our mind boggling number increase in sales of iPads and our inability to produce iPad mini's quick enough to meet demand was a good sign.
Back to the drawing board. I was blinded by those statistics where over 90% of mobile internet traffic is coming from iOS devices, oh well.
After reading these post I realized I have failed the mac community so I went out and bought a galaxy 3. WOW so innovative. The smooth plastic, the unique form factor, the guy at the store said it was so powerful i would need 3 extra batteries to get through the day. And I love the unique look. And so many options I have spent the last 3 day changing my backgrounds and icons while jony was busy editing a feature film on his iPhone. Why didn't we think of that "make the screen bigger" Those Samsung dudes have outdone themselves with innovation. can't wait to tell Jony to design a new iPhone with just a slightly bigger screen than the galaxy. I have a great idea for the ad campaign "the next slightly bigger than the next big thing is here"
Oh I even saw their new tablet comes with a stylus, gasp! We should have made a stylus for the three users of 230 million who requested one, those poor bastards now have to go to amazon and spend $1.50 for one. On that subject I feel shattered i didn't think of adding a physical keyboad like Microsoft did with the Surface. Boy did we miss the boat on that one. I actually heard they sold a Surface last week forgot to send Balmer a congratulations letter. Yeah I guess we did offer a keyboard for the original iPad as an accessory but they never sold.
Again I wanted to thank all of you for your insight and showing us the light
I don't know why we even have over 40,000 people working at Apple including the smartest engineers in the world, best computer programmers and one of the best run business management teams with the tightest channel inventory control in the world ever put together, stupid me I could of
gotten so much farther from all of your insights. PS I heard the 49's are looking for a new coach would any of you happen to have any experience in that department?
Tim
ps
I forgot to ask you guys since i am sure with all your knowledge from owning companies more successful than mine i need some investment advice.
I have this problem we have been making quarterly revenue of around 36 billion a quarter this has led to after expenses the accumulation of over 130 billion dollars in cash do you guys have any investment ideas?
we were thinking about buying the country Greece but Jony hates Gyros
Just wanted to send a shout out to all you mac rumor posters,
Your input has been so valuable to help us make better decisions in the future.
Boy did we blow it with the iPhone 5 we thought releasing a phone that was lighter, stronger , faster especially when compared to Samsungs latest offerings (see andantech processor ratings) better headphones would have sold much better. Actually we thought it was selling pretty good better than any previous model we have made, thank god for that WSJ article I guess our internal numbers were all wrong! I am so lucky to be able to get advise from all you folks at MacRumors with your extensive experience and knowledge running fortune 500 companies similar to ours the largest in the world.
Wow! I have been blind to our lack of innovation until i read this site thank you so much, again.
I thought our mind boggling number increase in sales of iPads and our inability to produce iPad mini's quick enough to meet demand was a good sign.
Back to the drawing board. I was blinded by those statistics where over 90% of mobile internet traffic is coming from iOS devices, oh well.
After reading these post I realized I have failed the mac community so I went out and bought a galaxy 3. WOW so innovative. The smooth plastic, the unique form factor, the guy at the store said it was so powerful i would need 3 extra batteries to get through the day. And I love the unique look. And so many options I have spent the last 3 day changing my backgrounds and icons while jony was busy editing a feature film on his iPhone. Why didn't we think of that "make the screen bigger" Those Samsung dudes have outdone themselves with innovation. can't wait to tell Jony to design a new iPhone with just a slightly bigger screen than the galaxy. I have a great idea for the ad campaign "the next slightly bigger than the next big thing is here"
Oh I even saw their new tablet comes with a stylus, gasp! We should have made a stylus for the three users of 230 million who requested one, those poor bastards now have to go to amazon and spend $1.50 for one. On that subject I feel shattered i didn't think of adding a physical keyboad like Microsoft did with the Surface. Boy did we miss the boat on that one. I actually heard they sold a Surface last week forgot to send Balmer a congratulations letter. Yeah I guess we did offer a keyboard for the original iPad as an accessory but they never sold.
Again I wanted to thank all of you for your insight and showing us the light
I don't know why we even have over 40,000 people working at Apple including the smartest engineers in the world, best computer programmers and one of the best run business management teams with the tightest channel inventory control in the world ever put together, stupid me I could of
gotten so much farther from all of your insights. PS I heard the 49's are looking for a new coach would any of you happen to have any experience in that department?
Tim
ps
I forgot to ask you guys since i am sure with all your knowledge from owning companies more successful than mine i need some investment advice.
I have this problem we have been making quarterly revenue of around 36 billion a quarter this has led to after expenses the accumulation of over 130 billion dollars in cash do you guys have any investment ideas?
we were thinking about buying the country Greece but Jony hates Gyros
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