Apple Cuts iPhone XS and iPhone XR Production By Another 10 Percent for Q1, 2019

iPhone XR side profile

Apple is reportedly cutting production for the iPhone XR, iPhone XS, and iPhone XS Max by 10 percent for Q1, 2019 of the calendar year. The company has already informed its suppliers about the order reduction.

The specific details of the production cut are not yet clear but Apple will now be producing around 40-43 million iPhones in Q1 compared to the original estimate of 47-48 million. The reason behind the cut in orders has again been put on the slow and sluggish iPhone demand in China.

Production volume in the January-March quarter of 19 is expected to be cut by about 10% from the original plan, and we informed the manufacturers of countries and regions that are responsible for parts etc. It is because sales are sluggish, especially in China.

Apple was reported to have reduced iPhone production orders during the lucrative holiday quarter as well. The company then went on to confirm the slowdown in iPhone sales by revising its revenue estimates for the quarter and lowering it by as much as $5 billion.

Our Take

With iPhone sales slowing down during one of Apple’s most lucrative quarter by a notable margin, it was clear that its ripple would be seen in the following quarters as well. Thus, Apple reducing its iPhone production for Q1, 2019 should not come as a surprise. In fact, we will likely see the company make more production revisions over the coming weeks and months as iPhone sales decline even further.

[Via Nikkei]