Falling iPhone X demand means Apple suppliers are suffering

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iphone x
iPhone X sales may not have been quite what Apple hoped for.
Photo: Ste Smith/Cult of Mac

Disappointing iPhone X demand is singled out as one major reason why the revenue of major Taiwanese manufacturers declined year-on-year in February.

Combined sales for nine Apple suppliers fell 4.8 percent in February, representing a two-year low. This is reportedly linked to Apple slashing iPhone X orders in half for the January through March period, although some suggest that actual demand could be even lower than that.

“For iPhone X, after supply chain checks, the shipment could be down to some 16 million for the current quarter and continue to fall to some 7 million units for the next quarter,” Jeff Pu, an analyst at Yuanta Investment Consulting, told Nikkei Asia Review. “[But] the supply chain could benefit from a higher average sale price per unit for the iPhone X and iPhone 8 ranges, as well as the relatively healthy demand for older and cheaper iPhone models.”

Major Apple manufacturer Foxconn saw its February revenue fall 4.1 percent, marking the lowest monthly revenue since way back in August 2014. Rival firm Pegatron, meanwhile, saw revenue for the month increase by 2.1 percent. The big difference between the two? That Foxconn is the sole supplier of the iPhone X, while Pegatron mainly builds the iPhone 7 and 8.

Other non-Apple reasons for the decline in revenue are credited as being a slowing mobile market and fewer working days due to the shorter month and Lunar New Year break.

Disappointing sales?

The suggestion that iPhone X demand is weaker than expected hit relatively early on in the new phone’s lifecycle. Early on, it appeared that Apple had done an amazing job on marrying demand with what we thought would be increased supply, by achieving next day delivery in almost record time.

However, since then it seems that most analysts have suggested that iPhone X demand, perhaps buoyed by the high price of the handset, has not been what many hoped for. While Apple’s share price is no longer as predicated on solely iPhone sales as it has been in the past, that’s still a disappointment given that 2018 was supposed to be a “supercycle” year for the iPhone.

Have you bought an iPhone X this year? Have you seen less or more of them around than normal? Let us know in the comments below.