Apple is said to be cutting its iPhone orders ahead of another weak quarter to prevent a build up of inventory. The move means it will likely miss Wall Street estimates again, but analysts expect over a year of growth after iPhone 7.
iPhone demand has been falling as fans become somewhat bored with Apple’s latest models. Last quarter, the company reported its first decline in iPhone revenue since the device made its initial debut in 2007.
Things aren’t likely to get better anytime soon. Analysts Ananda Baruah and Shenlun Wang at Brean Capital report that Apple is cutting its orders for both the June and September quarters to reduce excess supply ahead of the introduction of the iPhone 7.
It’s estimated that Apple has ordered 40 million units for each of these quarters, which is below Wall Street’s expectation of 42 million units.
When entering 2016, it’s thought Apple had around 18 million iPhones in its inventory channel, and would now like to reduce that number to around 10 million units ahead of the iPhone 7’s launch in September.
When this time comes, Apple is expected to enjoy five straight quarters of growth, and could see its share price jump to $125. Baruah and Shenlun also add that the company could bring its revamped iPhone 8 launch forward to June or July in 2018.