Apple Cuts iPhone 5 Component Orders By Half Due To Weak Demand

iPhone-5-Display

The Wall Street Journal reports that Apple has cut orders for iPhone 5 components by almost half due to weak demand according to “people familiar with the situation”.

The report notes that Apple has cut the orders for iPhone 5 screens and other components for the January-March quarter.

From the WSJ report:

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.

While it is quite normal for the demand to slow down in January-March quarter, the fact that Apple is cutting orders based on its own estimates which would have accounted for it, should be a concern for the company.

There have been speculations that Apple may launch the next generation iPhone in June. There are also reports that Apple may launch a higher-end iPhone in June, followed by a lower-end iPhone. If this rumor of a slow down in demand is indeed true, then it will definitely force Apple to launch the next generation iPhone sooner rather than later.

It is also important for Apple to strike a deal with China Mobile – the world’s largest mobile carrier, which was probably the reason both Tim Cook and Phil Schiller were in China last week.

Via: WSJ

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  • so far this is the best story about the iphone5 that ive read..

  • Rehanna

    I don’t really know if this is true, here in South Africa people are still waiting for their Iphone 5 since 14th of December 2012. There is actually a shortage due to high demand according to iphone suppliers. I have been also in the Middle East in December where there is a huge shortage in shops and people can’t wait to get their hand on one.

    • JCT

      thats because if import laws and all that extra impossed taxes from import and what the suppliers are allowed to order per shipment or can order depending on limiting factor, but it was proven that in china it was a flop as they said not alot of people there on release day still sold a bunch but 4s sold better

  • Alterian

    I’m waiting for may and see what the GS4 has.

  • Alan

    Is the iPhone party over?

    • JCT

      per the teens yes, its no longer cool to have a iphone when everyones grandma got one

  • JCT

    problem is that no jailbreak some people like me are waiting for that until then this and the new ipad wont get huge demand again, wait and see when jailbreak release bunch of people will flock to buy again

  • sd

    apple: time to sue samsung

  • Pacomacman

    I skipped the 5 because I don’t like the 16:9 display…so I’m waiting for the next generation. I bet quite a few iPhone owners are prepared to skip the 5!

  • Drusenija

    With smartphones becoming more and more ubiquitous, we’ve surely got to reach a point where growth stops coming from new smartphone users and has to start coming from conquests (i.e., getting users of Android, WP8 and Blackberry to switch to iOS), and whilst iOS is a good smartphone platform, I don’t see it having any particular standout features at the moment to warrant switching from a different ecosystem into Apple’s.

    On the flipside I feel the same way about Android at the moment as well, but it means that sooner or later you have to start displacing customers from other platforms to grow – new sales can only go for so long until man+dog has a smartphone (even new markets for Apple like China still have a lot of established smartphone users), and your existing customers as a general rule will upgrade as their phone plan allows (i.e., every 2 years), which results in a steady stream of sales with bursts around launch time, but not enough to actually sustain growth.