Apple Cutting Q4 iPhone Production?

[cameronjpu]

Considering that iPhones counted for 40% of Apple's revenue in Q4, this could create the illusion of a bad quarter for Q1, especially since Q4 was artificially inflated with the result of a year and half of iPhone sales.

Uh huh, and Q1 will be inflated with the result of a year and 3/4 of iPhone sales. So?

 

[cameronjpu]

well it makes sense, most people would get this device when it came out. its not like you'd need constant production when its on a 18-24 month contract.

Not true - people who are able to buy the iPhone must not be on a contract. While many buyers are paying retail, many more are on a previous contract that they are waiting to expire. Every month more people finally become able to freely buy an iPhone.

 

[cameronjpu]

No your not the only one. I have also had this problem.

Apple will definitely come up with a way for buyers to buy the iPhone for a surprise Christmas present in advance.

 

[cameronjpu]

But this is not a "slow down" of the iPhone. It was just a weird bonus where the first few months were abnormally high. Sales will be just fine now, they just won't be abnormal anymore.

As long as they keep adding new countries, this abnormal effect will still come into play quarterly. They do have what, another 20 countries still to come this year? And China and India still to come, correct? Lots of pent-up demand in both of those places.

 

[crisss1205]

Another contributing factor is believed to be the recent economic downturn:The analyst bases his findings on "recent checks" on the chip industry. The news comes shortly after Apple reported record iPhone earnings capturing 2.3% of the mobile phone market.

Article Link: Apple Cutting Q4 iPhone Production?

I don't think its anything with the economy because whoever wanted an iPhone really bad has gotten one already so they are adjusting to the demand. Why make more if everyone has one already (that wants one).

 

[happydude]

i think they're using the holiday season to push out all the current stock, then in the new year, they'll roll out a 32GB to renew a little interest. maybe another price drop to compete with the "price umbrella" or whatever the phrase was steve mentioned.

 

[rdowns]

Link

The Apple analyst who couldn’t shoot straight
What is it with Craig Berger and Apple?

The FBR Capital Markets analyst made headlines Monday with a report that Apple had slashed iPhone production for this quarter — down as much as 40% from the September quarter in which Apple racked up record sales of 6.9 million units. (See here.)

Berger bases this gloomy forecast, he says, on “recent checks” with unnamed sources, and goes on to draw some macro-scale conclusions:

“That the firm’s iPhone production plans are being revised lower suggests that the global macroeconomic weakness is impacting even high-end consumers, those that are more likely to buy Apple’s expensive gadgets, and that no market segment will be spared in this global downturn. This is a negative signal for global demand, in our view.” (link)

Sounds pretty scary. But perhaps best taken with a grain of salt, given Berger’s track record with Apple. To wit:

In February 2008, Berger wrote that “recent checks” showed that Apple had cut its build plans for iPods and iPhones, from an anticipated 50% decline between calendar Q4 and Q1 to a 60% decline. He also reported that Apple had cut its build forecast for MacBooks for the same period, from down 35% to down 50%. (link)

In April, Apple reported its calendar Q1 (fiscal Q2) earnings. iPhone sales were indeed off after the Christmas quarter, but only by 26%. And MacBook sales, rather than falling 50%, actually rose — up nearly 7%, from 1.3 million in calendar Q1 to more than 1.4 million in Q2. (link)

In May 2008, Berger checked again with his contacts in Apple’s supply chain and reported another round of bad news: his sources were telling him that orders for iPhones for calendar Q3 had been cut 25%. (link)
A month later, Berger went back to those sources and came back with a very different story: 2008 iPhone build volumes, he said, had been “revised significantly higher” — with more than 15 million 3G iPhones plus two million old 2G iPhones forecast for 2008. Apple’s notebook and desktop build volumes were also revised up — by 10% and 20%, respectively. “The firm,” he wrote, “continues to knock the cover off the ball in terms of product innovation, sleek designs, attractive price points, and effective global deployment plans.” (link)

On Monday Berger was back to singing the blues. Apple had been expecting to cut iPhone production 10% this quarter, he wrote, but was now looking to cut it 40%. Such a cut, he says, “could end up painting an ugly picture” — although perhaps not quite as ugly as it sounds. For instance, Piper Jaffray’s Gene Munster is calling for iPhone sales to grow 43% quarter to quarter. (link)

Berger could not reached for comment.

It should be noted that Berger specializes in chips, not computers or smartphones. He is not on StarMine’s list of analysts who spend a significant amount of their time covering Apple . Nor does he appear on the list of analysts dialing into Apple’s quarterly earnings calls.

 

[Aetles]

Bullish Cross (Andy M. Zaky):

FBR chip analyst Craig Berger, an analyst who doesn't cover Apple, issued an interesting note today regarding iPhone production rates. He noted that according to his unqualified "checks" (whatever they may be) iPhone production rates may fall up to 40% in calendar Q4 (fiscal Q1). It's interesting that a semi-conductor analyst thinks he is even in a position to be able comment on a company that he doesn't cover—a practice that seems to be the trend this year. But this wouldn't be the first time that Craig Berger has commented on Apple's production rates and it certainly wouldn't be the first time he was dead wrong. As a matter of fact, saying that Craig Berger has been "dead wrong" in his forecasts with Apple would be a gross understatement as the data illustrates below. I would even go so far as to actually view Craig Berger's projections as being extremely bullish. See for yourself.​

Read more: FBR Chip Analyst Craig Berger’s Questionable Track Record with Apple

 

[BarcelonaApple]

This is the first news I've heard that the economy is effecting Apple. Perhaps now they will consider a low(er) end MacBook or revamping the Mac Mini. Any thoughts?

First news, it seems like every day a so called analyst comes and says something about Apple being doomed.

 

[Rocketman]

If you look how it is carefully worded to say production cut, one wonders if this is simply a matter of Apple being on target on sell-through, and caught up on pent-up demand, and they are simply targeting the next upgrade date. It has to be hard to properly measure demand worldwide on something that sells over 10 million units a year.

Rocketman

 

[mccldwll]

Aetles is exactly right. Berger doesn't know his ass from a hole in the ground, and FBR as a going concern is on life support and probably would be more than willing to "cooperate" with the hedgies (there are still a few which haven't gone belly up) which are going to have to come up with some big bucks by the 15th. The industry and many/most of the "analysts" are puppets, and why anyone would pay any attention to anything they say is beyond me.

 

[offwidafairies]

This is the first news I've heard that the economy is effecting Apple. Perhaps now they will consider a low(er) end MacBook or revamping the Mac Mini. Any thoughts?

would be nice.

of course the economy is effecting apple. apple is an american company. and the troubled economy is having a negative effect on most people.

VOTE NO ON PROP 8 - EQUALITY FOR ALL

 

[Zillion]

Real reason

 

[BenRoethig]

That moron is suggesting that Apple customers behave as the others. No real proof at all to say there will be a cut on production.
Is like someone say, oh we predict SUV's will be affected cause the bad economy.
That dude need another job 😀

The vast majority of iPhone users probably aren't your average Apple customer.

Uh huh, and Q1 will be inflated with the result of a year and 3/4 of iPhone sales. So?

No it won't. Apple did not report any revenue on the iPhone until Q4 when it reported all the revenue from the iPhone.

 

[137489]

you would have thought they would have done that in October with all the speculation of price drops.

Personally, I stopped holding my breath on price drops and a dock that would support my current early 2008 macbook. I am building my own.

Since most docs I have seen (for Apple) are just port replicators..... mine is nothing eloquent, most my stuff runs off of USB and it will get the job done...

1. bought a 7 port powered USB hub and plugged all my "fixture" devices into that (timemachine backup drive, external lightscribe DVD burner, printer, wacom bamboo, cool pad [which also has a 4 port hub on it; incase I need more)], will be buying a wired apple keyboard.

2. I have a 15-inch KDS monitor that is 5 years old (VGA). Will get the job done for now, but after moving the mini to the bedroom and connecting it to an LCD HD TV - that monitor will need to be upgraded; looking at a 19 or 20 inch non-apple widescreen (possibly HD) due to price [Apple ACD's are just way to expensive for what they offer]. I was surprised of the quality and well, had I not see the mini on the HD TV, I would probably not even consider the monitor upgrade. 😀

So basically, I plug 1 USB, magsafe, mini DVi, speakers and LAN (just to have more speed over wireless - but not necessary) and bam... Like I said, nothing eloquent but gets the job done for me. and for about $300-$400 it is less than basically the same thing I would've gotten with an Apple LCD with only 2 UBS ports and still would have had to buy a hub.

Once I figure out how to get Front row to recognize external drives for my movies and videos, I may loook at a 1 TB drive just for entertainment 😎

Completed the process last night with 19-inch LG monitor (wanted bigger, but the desk that is it on is too small with all that else is on it. Works pretty darn good and total proces was at about $300. On to finishing trning the mini into an entertainment center. My wife is already loving using it on a high-def LCD TV, and can switch between the internet and watching TV pretty quickly. Even got her enjoying hulu

 

[garybUK]

HAHAH brilliant!!!!

And to the person who suggested a 'iPhone with built in iSight'...... uuuurm haven't 1000's of 3G phones with front facing video call camera been doing this for years?!?!?!?

 

[RobertFranz]

We have a couple of Iphones in our company.
We won't be getting any more.
They're fun to play around with for a while, and probably ok for a consumer, but have no real use for us here.

If Apple wants to make inroads into Corp Amerika, they need to do a couple of things:

1> Stop trying to tie in into other Apple products.
I could give a fig about Itunes.

2> Supply an rdp client.

3> Display a strong commitment NOT to interfere with, disable, or alter the software installed on the customer's phone.

4> Include a memory card slot

5> Provide a replaceable battery

I have to remote into servers regularly, and need the freedom to install any software (or write my own) to get the job done.

I can't rely on jail breaking the phone, and then having an app stop working because Apple updated something.

I need to be able to use my phone for extended periods of time, especially when it's acting as a wireless router when I'm traveling.

This is why I turned down an Iphone and went with an HTC SmartPhone instead.

It's not without it's own flaws - some serious.
But none that are deal breakers in terms of getting my work done.

A downturn in Iphone sales would be a *good* thing, if it forced Apple to reconsider it's design choices.

I'd probably need a different screen too.
The Iphone screen is pretty and rugged, but not being able to use a stylus limits the ability to do anything requiring fine ui control.

I have less trouble with the input than most Iphone users, but that's probably because I've been tapping on little gadgets for years.

 

[BarcelonaApple]

Not funny. 🙄

We have a couple of Iphones in our company.
We won't be getting any more.
They're fun to play around with for a while, and probably ok for a consumer, but have no real use for us here.

If Apple wants to make inroads into Corp Amerika, they need to do a couple of things:

1> Stop trying to tie in into other Apple products.
I could give a fig about Itunes.

2> Supply an rdp client.

3> Display a strong commitment NOT to interfere with, disable, or alter the software installed on the customer's phone.

4> Include a memory card slot

5> Provide a replaceable battery

I have to remote into servers regularly, and need the freedom to install any software (or write my own) to get the job done.

I can't rely on jail breaking the phone, and then having an app stop working because Apple updated something.

I need to be able to use my phone for extended periods of time, especially when it's acting as a wireless router when I'm traveling.

This is why I turned down an Iphone and went with an HTC SmartPhone instead.

It's not without it's own flaws - some serious.
But none that are deal breakers in terms of getting my work done.

A downturn in Iphone sales would be a *good* thing, if it forced Apple to reconsider it's design choices.

I'd probably need a different screen too.
The Iphone screen is pretty and rugged, but not being able to use a stylus limits the ability to do anything requiring fine ui control.

I have less trouble with the input than most Iphone users, but that's probably because I've been tapping on little gadgets for years.

Why should you care about the iphone, seems you and your company seem to think it's a toy, and here you are wishing that it's sales goes down, why should you even care, I just don't get some of you.

 

[Neebee]

From my experience, many people I know who bought the iPhone bought it as an impulse buy and regret doing so in some way. Most of these people don't recommend the iPhone to others, so this in turn could be part of the reason why production will be cut. If there is a shortage for Xmas then Apple will be very happy that interest in the iPhone is still high. Then again, they could be doing what Nintendo did with their Wii, deliberately causing a market shortage to stimulate demand.

 

[hihater]

From my experience, many people I know who bought the iPhone bought it as an impulse buy and regret doing so in some way. Most of these people don't recommend the iPhone to others, so this in turn could be part of the reason why production will be cut. If there is a shortage for Xmas then Apple will be very happy that interest in the iPhone is still high. Then again, they could be doing what Nintendo did with their Wii, deliberately causing a market shortage to stimulate demand.

So I guess your little anecdote means that Apple should be worried right? 🙄