Apple (AAPL) Said to Cut iPhone 5 Panel Orders as Demand Wanes
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Price: $165.00 -1.22%
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Dividend Yield: 0.5%
Revenue Growth %: -4.1%
Overall Analyst Rating:
NEUTRAL (= Flat)
Dividend Yield: 0.5%
Revenue Growth %: -4.1%
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Apple (Nasdaq: AAPL) is trading lower Monday morning amid chatter that demand for its iPhone 5 might be, well, light.
According to Japan's Nikkei news source, Apple has halved orders for iPhone 5 panels as demand is said to have dropped off.
Apple was initially expected to order 65 million panels in the current quarter from suppliers like Sharp, LG (NYSE: LPL), and Japan Display. Nikkei also said the Japan Display might ease output by up to 80 percent, while Sharp plans to lower production at its Mie facility in Japan by 40 percent for January and February, versus October through December last year.
Suppliers were notified last month of the cut.
The WSJ this morning also said that orders for other iPhone 5 "components" have been cut as well.
With Samsung shipping nearly twice as many smartphones in the most recent quarter (56 million versus 26.9 million iPhone units), Apple has been pressured to increase sales numbers and gain market share. IDC recently noted that Samsung controls over a 31 percent of the global smartphone market, versus about 14.6 percent for Apple.
One way Apple could sustain growth and gain share that was speculated last week was the introduction of a new, lower-cost iPhone model. Nearly as fast as the chatter started, Marketing Chief Phil Schiller downplayed the idea, saying Apple would never make such a device.
With Apple shares down over 26 percent from all-time highs of $705.07 last September, investors are hoping today's news is more fluff than substance. Apple is down over 3 percent in early trading.
According to Japan's Nikkei news source, Apple has halved orders for iPhone 5 panels as demand is said to have dropped off.
Apple was initially expected to order 65 million panels in the current quarter from suppliers like Sharp, LG (NYSE: LPL), and Japan Display. Nikkei also said the Japan Display might ease output by up to 80 percent, while Sharp plans to lower production at its Mie facility in Japan by 40 percent for January and February, versus October through December last year.
Suppliers were notified last month of the cut.
The WSJ this morning also said that orders for other iPhone 5 "components" have been cut as well.
With Samsung shipping nearly twice as many smartphones in the most recent quarter (56 million versus 26.9 million iPhone units), Apple has been pressured to increase sales numbers and gain market share. IDC recently noted that Samsung controls over a 31 percent of the global smartphone market, versus about 14.6 percent for Apple.
One way Apple could sustain growth and gain share that was speculated last week was the introduction of a new, lower-cost iPhone model. Nearly as fast as the chatter started, Marketing Chief Phil Schiller downplayed the idea, saying Apple would never make such a device.
With Apple shares down over 26 percent from all-time highs of $705.07 last September, investors are hoping today's news is more fluff than substance. Apple is down over 3 percent in early trading.
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