iPhone Demand May Decrease Nearly 20%

iPhone Demand May Decrease Nearly 20%

  • Concerns over demand for iPhone in the U.S. and Europe persist
  • Apple has postponed the production of the new phones with 5G - sources
  • Unnamed supplier of displays for iPhone is preparing for a 17% drop in orders for 2020

One of Apple’s (NASDAQ:AAPL) major contractors for iPhone production said it expects orders to decrease by 18% for the first quarter ending in March compared to the same period a year ago, sources told Reuters.

“No one is talking about manpower or material shortage (in China) anymore. Now everyone is looking at whether demand from the U.S. and Europe could keep up,” said the person, who has direct knowledge of the matter.

“The focus now is the demand from consumers in the U.S. and Europe.”

Apple is also postponing the planned increase in the production of new phones that work with next-generation 5G networks.

An unnamed supplier of iPhone displays for Apple is preparing for a 17% drop in orders for this year, Reuters also reports. As a result, the company is preparing to cut jobs in its Vietnam-based production facility.

“Things are changing on a day by day basis due to supply chain disruptions, so it is difficult to craft any meaningful comment at the moment about both supply and demand,” said an official at one supplier in Malaysia.

Arthur Liao, a tech analyst at Fubon Research, cut yesterday expected iPhone shipment forecasts from 41 million units to 35 million units, a decrease of 17%.

On the other hand, a sensor producer for the iPhone says the company is producing parts as planned.

“We were given a forecast for this quarter before the pandemic, about a month ago,” an unnamed source from the company said.

“And now we are still producing as per the forecast given to us.”

Elsewhere, Apple confirmed yesterday that it is developing an app, together with the Trump administration and federal agencies, to direct users to the Centers for Disease Control (CDC).

According to the tech giant, the app – “COVID-19” – will ask users questions about symptoms, location and risk factors and then provide them with further guidance, stemming from the CDC. On the privacy concerns, Apple said that neither them nor the government will collect any personal data.

By Michael Harris
Specialising in economics by academia, with a passion for financial trading, Michael Harris has been a regular contributor to Invezz. His passion has given him first hand experience of trading, while his writing means he understands the market forces and wider regulation.

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