Apple is cutting iPhone X production by half: Nikkei

Apple to cut iPhone X production
Apple staff holds iPhone X packages at the Apple Store in Berlin, Germany, November 3, 2017 REUTERS/Hannibal Hanschke

Apple Inc has reportedly been planning to reduce the iPhone X production by 50 per cent for the first quarter. According to Nikkei, partner suppliers were already informed of the new target, from 40 million down to around 20 million units.

The underwhelming sales during the holiday shopping season in the US, Europe, and China has been cited as the primary reason for the cut. The Silicon Valley giant welcomed the year with predictions that the iPhone X may not be selling well after lower-than-expected demand for the new phone, causing Apple's shares to drop at the end of 2017.

Also read: China begins losing smartphone buyers after 8 years of stunning growth

Nikkei added that Apple is slated to maintain a total production target of 30 million units for the iPhone 8, iPhone 8 Plus and iPhone 7. It did not cite the source of information, and Apple has yet to respond to questions regarding the cut.

Days before and after the launch of the iPhone X in September 2017, Apple had been hyped to fall short of supplies for the groundbreaking smartphone. During the holiday shopping season, when the device was already out, it failed to convince consumers of its worth, priced at US$999 and more in some countries.

Approaching the release date, the iPhone X sales predictions were "inflated" as some analysts called it. In a research memo released in December 2017, CLSA analyst Nicolas Baratte warned clients to lower their expectations for the Q1 2018 for the same reason.

"We maintain that 2017 fourth-quarter iPhone X volumes were at 30 to 35 millions and we are very skeptical that volumes will increase in the first quarter of 2018", says Baratte as CNBC reported.

This article was first published on January 29, 2018