Apple Slashes iPhone 5 Part Orders Due to Weak Demand

[MacRumors]

The Wall Street Journal reports that Apple has slashed component orders for the iPhone 5 this quarter, responding to weaker-than-expected demand.

Apple's orders for iPhone 5 screens for the January-March quarter, for example, have dropped to roughly half of what the company had previously planned to order, two of the people said.

The Cupertino, Calif., company has also cut orders for components other than screens, according to one of the people.

Apple notified the suppliers of the order cut last month, the people said.

There have been reports that Apple is looking to launch its next-generation iPhone in the middle of this year as part of a broader effort to shorten its product update cycles. Apple is reportedly also toying with other changes such as a cheaper version of the iPhone in order to help the company slow the momentum of Android and its leading manufacturers Samsung.

It is not unusual for demand, and thus Apple's component orders, to wane in the lead-up to hardware updates, but the iPhone 5 is just four months old, and the slashing of production at this stage of the device's lifecycle is sure to cause concern for the company, its investors, and others closely watching Apple's performance.

Article Link: Apple Slashes iPhone 5 Part Orders Due to Weak Demand

[viperGTS]

This worries me a little...

[Exotic-Car Man]

Perhaps they will go back to the July as the release month?

[AHDuke99]

I need to dump the stock. I don't see it rebounding to $700/share.

[jackfungi]

Lets go Ive.

[cflem]

Monday is going to be rough... just see it all as a correction though. Their earnings will beat the street. I say buy when it tanks.. and ride the wave. call me crazy.

[kjs862]

Can thank a stale design and os for this.

[enkadrummer88]

When are people gonna remember that Apple's vision is to NEVER make cheap products to compete with other companies, but to make GREAT products (at all costs) to please the consumers?

I'm very skeptical of a cheap iPhone coming any time soon.

[notjustjay]

Haven't the last few weeks (even months) been filled with rumors like "Apple to update iPhone even sooner than expected"? Wasn't there talk of a 5S, even a 6, already under development?

So how is this a surprise to anyone?

[Henry.A.Raven]

This worries me a little. especially after only just launching in China. does anyone know how many more territories it has yet to launch in, if any?

[benji888]

whatever...

...why rumors about a cheaper iPhone? $0.99 (on contract) for iPhone 4 isn't cheap??

blah blah blah

[Dwalls90]

This isn't really a surprise ...

iPhone 5S rumors (which NEEDS to happen, annual hardware updates for your NUMBER ONE product line is inexcusable), iPhone 5 initial issues with scuffing and Wifi, iOS 6 being stale and the maps fiasco, not to mention lack of jailbreak.

I LOVE Apple products, but ever since the iPhone 4S's release I've started to get bored and watch Apple be surpassed by even WP8 in some areas.

They need to lock down contracts in China and other areas of the world. They really only dominate the US market.

And the WSJ doesn't know this for sure, I'll wait to see the financials for the quarter before making judgement. Isn't it common for post-holiday shipment cuts? People surely don't buy in January like they do in December.

[Saladinos]

I'm not surprised.

I usually try to judge these things based on anecdotal evidence, and from that perspective the iPhone 5 is a flop. Of course it depends on my location, place of work and a billion other factors, but in a modern busy city you see a lot of random people with their phones and occasionally you notice one.

I don't tend to see a lot of iPhone 5s around.

Personally, I'm not tempted to buy one, either. The iPhone today does basically the same things the iPhone 4 did, just faster. The iPhone 4 was as big of a shake-up as the iPhone's had since launch (and even then it was a new case and faster internals).

There hasn't been anything revolutionary. Nothing that really pushes the device to the next level or provides something radically different. NFC could do that, but in that case it's less about physically sticking it in to the phone and more about building up the infrastructure; unfortunately Apple doesn't seem to be doing anything there, and they don't seem to be doing anything else either.

As always, would love to be wrong, hope they have something really great. Unfortunately when you build your brand on innovative ideas, people expect you to keep delivering. When those ideas run out your brand will just lose steam.

[Lancetx]

Stock manipulation at it's finest, once again.

[Woodcrest64]

Why are you worried?

[topmounter]

I have a perfectly good iP4 and I'm out of contract w/ AT&T, but the iP5 really didn't do much for me... at least no where near enough to drop $299 and re-up my contract. I've been considering picking up a Google Nexus 4 ($199 w/ No Contract) to entertain me until the next "must have" iPhone (I actually like Jelly Bean on my Nexus7).

[AHDuke99]

Correction? We're down $200 from its highs. We're heading to $450 most likely. I should've sold back at $600, but I kept thinking a lot of this was white noise. I am not sure I have the balls to hold through earnings.

[ivladster]

But Apple already made millions of iPhones and ramped those factories like crazy from August-November. They might have made too many, so they need to slow down a bit. If 5S is coming this summer, that means there are new parts which are waiting for new production. So things like new screen, new chip are no longer needed to be stocked in high quantities.

[justperry]

Not surprised, iPhone 4-4s has a much better and durable design than the iPhone 5.

(Durable = less scratches, scuffs)

[AC Rempt]

Interestingly enough, this is also the first time AT&T didn't offer me an early upgrade for my contract since I bought the 4S. If they had, I would've bought a 5 with glee. I wonder how many people had the same thing happen.

[buddybd]

Components other than screen, 5S confirmed!

[blitzkreig]

Buy high and sell low? Oh that is a good idea ...

[Preed08]

My evidence is also anecdotal, but everybody i know seems to be riding the large-screened android wave. Even though every manufacturer is guilty of on incremental, evolutionary updates, the iphone is seen to be selling the same thing year by year, more so than other manufacturers (at least in their eyes)

Apple kinda needs to shake it up, if they pull another 4-4s with the transition from the 5 to the next then even more people will join in that opinion.

[ThatGuyInLa]

I love my AppleTV, my iPad Mini, and my 2010 27" top-end iMac. For a phone nowadays I am completely impressed and happy to use my contract free, $45 a month, UNLIMITED, Samsung Galaxy S2. ($240 to buy outright)

Sure parts of its OS aren't as elegant as iOS but it's a heck of a phone/mini computer. And as much as the iPad Mini is the best form factor for a tablet, the S2s screen size is the best for a phone. This new "tall" iP5 is dumb. The old screen was simply too small and needed to be bigger overall, not just along one axis. It was always frustrating to do anything but phone stuff with it as apps evolved and became more intricate.

I really hope Apple figures something out to wow the masses again with their phone since it does makeup the largest portion of their business. Even if I'm never a phone customer of theirs.

[Preed08]

no, durable usually means less prone to breaking...and which of the models wins at that? Certainly not the glass-backed ones....


Edit: thats to Justperry. It wont let me quote and i dont feel like manually doing it.