Slowing iPhone sales aren’t just bad news for Apple.
Foxconn, the company’s largest manufacturing partner, is also suffering as a result of weakening iPhone demand, with revenue for December falling 8.3 percent year-over-year.
It’s the first time Foxconn has experienced a drop in revenue in almost a year.
The iPhone X taught us that Apple fans don’t mind paying high prices for the company’s latest smartphones, but it turns out the tenth anniversary handset may have misled us. The newest iPhone lineup isn’t selling as well, and that’s having a huge impact.
Not only have slowing sales decimated Apple’s market cap in recent weeks, but they’re also causing problems for iPhone suppliers.
Foxconn revenue falls as iPhone demand shrinks
Foxconn, which assembles the vast majority of Apple devices, including the iPhone, is one of the first to report falling revenues following Tim Cook’s open letter to investors warning of weak iPhone sales.
Foxconn confirmed that in the month of December, it suffered an 8.3 percent decline compared to the same period a year earlier. Revenue fell from $21.91 billion in 2017 to $20.12 billion in 2018.
Foxconn didn’t call out the iPhone as this main reason for this, but given that Apple accounts for much of its revenue, it makes sense that falling iPhone demand would be a contributing factor. Foxconn did blame “the fall for consumer category products.”
Apple blames China
Cook blamed the significant fall in smartphone sales in China for the iPhone’s struggle, as well as things like “foreign exchange headwinds.” However, Cook denies that the iPhone XR is a flop.
In a recent interview, Cook said iPhone XR, which starts at $749, has been Apple’s best-selling iPhone since it made its debut, and recent data from third-party research firms backs up those claims.