Tuesday, January 15, 2013

Apple Peels Back Orders for iPhone 5 Components

Posted By on Tue, Jan 15, 2013 at 9:11 AM


Apple shares opened lower this morning on the NASDAQ exchange in the wake of Monday's report that Apple has cut their orders for iPhone 5 parts significantly, which some have speculated was in reaction to lower-than-expected demand.

The company's orders for screens for the new model have dropped to around half of what they had initially planned to order for this coming quarter, the Wall Street Journal reported.

Japanese daily Nikkei reported similar cutbacks, saying that Apple has asked suppliers Japan Display Inc., Sharp Corp., and South Korea's LG Display Co. Ltd. to cut back on some of the iPhone 5's components, according to Reuters.

Business Insider's Jay Yarow wrote:

Apple is expected to sell ~48 million iPhones in the December quarter. If it meets that expectation it would be Apple's best ever iPhone quarter. Yet, somehow Apple was putting in an order for a giant sequential increase?

The new order number of 32.25 million sounds more reasonable. (We can't find a consensus number for the March quarter.) But we find it hard to believe Apple cut its orders in half.

Apple's hold on the smartphone market has also reportedly been dropping over the last year or so. While it held control over 23 percent of the market in the fourth quarter of 2011, that number had dropped to 14.6 percent by 2012's third quarter.

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