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Apple saw disappointing iPhone X sales this holiday season, so it’s readjusting it’s targets for the first quarter. The company reportedly cut iPhone X production targets in half, which could deal a heavy blow to suppliers.
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Apple is reportedly halving iPhone X production targets after disappointing sales this holiday season, according to a new report.
The iPhone X is the company’s most advanced smartphone yet but it also comes with a staggering price tag. While iPhones have never been cheap, the iPhone X is the most expensive one yet, sporting a $999 starting price.
The high price tag might have put off prospective customers and Apple’s holiday sales were reportedly worse than it expected. Hence, the company has decided to cut iPhone X production targets in half in the first quarter of this year.
Apple Slicing iPhone X Production Targets In Half
The report comes from Asian news outlet Nikkei, which claims that Apple has notified suppliers that its iPhone X production target for this quarter is now 20 million units. Previously, the company had reportedly targeted 40 million iPhone X units for this quarter.
Nikkei details that the lower production target stems from disappointing holiday sales in the United States, Europe, and China. Apple will reportedly maintain its 30 million production target for other models in the iPhone 7 and iPhone 8 series.
This dramatic reduction in iPhone X production targets, however, might deal heavy blows worth billions of dollars to Apple suppliers.
“The production cuts for the X will have a domino effect on manufacturers that have supplied high-performance components for the handset, with the combined impact expected to run into billions of dollars,” says Nikkei.
Apple To Cut OLED Screen iPhone Production?
The iPhone X is the first smartphone from Apple to feature an organic light-emitting diode display, which is partly why it’s so expensive. Reports indicated that the iPhone X has a high price tag because the OLED displays from Samsung are expensive. Apple could not also find another supplier that could guarantee a constant, reliable supply at lower costs.
With this in mind, Nikkei also notes that Apple is now considering to lower the production of iPhone models with OLED displays and boost the production of iPhone models with LCD displays.
On the other hand, trusted KGI securities analyst Ming-Chi Kuo recently said that he expects Apple to launch three new iPhone X models this year. Two of those models will have OLED displays while the third, the so-called iPhone X SE, will have an LCD screen, according to the analyst.
Opinions and expectations are divided, however, and other analysts tend to agree with agree that the ratio is inverse, with 2 LCD-screen models and one OLED-screen model.
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