Apple Slashes iPhone X Production by Half On Weak Demand

Apple Slashes iPhone X Production by Half On Weak Demand

In the run-up to Apple’s iPhone X launch, it was clear that the company could end up pinched by its own product plans. On paper, the plan looked solid: Refresh the iPhone 8 and iPhone 8 Plus at lower price points, before bringing in the iPhone X, with its $1,000 price point, new technology (at least for Apple), and premium sales pitch. But once it became clear customers weren’t biting on the iPhone 8, Apple faced a difficult situation. If demand for the iPhone X didn’t hold strong, the company could be left between a rock and a hard place, with customers who skipped upgrading to the iPhone 8 (because it wasn’t sexy enough) but who weren’t sold enough on the iPhone X, due to some mixture of cost and features.

Globally, Apple’s overall performance is a bit of a muddle. In the UK, US, and China, Apple continues to impress, with 49.4 percent, 39.8 percent, and almost 25 percent of the market in each nation respectively. But Nikkei reports Apple made the decision to cut production after slow holiday and end-of-year sales didn’t deliver the product shipments Apple wanted.

It Takes a Village

One thing the Nikkei piece does well is highlight how complex smartphone manufacturing is, and how the impact of one company’s allocation changes ripples throughout the entire ecosystem. If Apple slashes production orders for the iPhone X, it doesn’t just impact Apple — it impacts Sony, Samsung, and every other company that manufactures components for the iPhone X as well. The result could improve NAND supplies if fewer iPhone X shipments free up capacity in the market (and to that end, any chance we can get some more DDR4 for PCs?) Nikkei even speculates that we could see slower shifts to OLED panels from LCDs if Apple doesn’t keep pushing that technology into the market.

Apple Slashes iPhone X Production by Half On Weak Demand

It’s absolutely true that what Apple says and does matters in the smartphone business. Android manufacturers have led the way with some features, like wireless charging, but what Apple is doing — or not doing — sends signals to other companies that compete with Cupertino. The most significant aspect of this trend may be in emerging technology, where Apple cash and resources can drive the development of tech that is then leveraged by everyone else as well.

But I’d hold off before declaring various tech adoption trends damaged because Apple’s $1,000 smartphone may not have sold particularly well. The iPhone X was a unique product from Apple, the first of its kind. Apple may not have known what kind of sales it could expect, and it’s probably still evaluating whether it makes sense to keep a $1,000 SKU available at all. If Apple thinks it can actually shift mainstream pricing in that direction, it absolutely will, but a sharper-than-expected decline in sales could be great news for everyone who doesn’t want to see smartphones get more, not less, expensive.

Apple’s overall level of sales isn’t expected to change much. The iPhone X only went on sale in November, so most of Apple’s sales would’ve been on conventional models — the iPhone SE, iPhone 6s, iPhone 7, and iPhone 8 families. Apple reports its results on Thursday, so we’ll know more about the company’s performance by then.

Continue reading

Intel Launches AMD Radeon-Powered CPUs

Intel's new Radeon+Kaby Lake hybrid CPUs are headed for store shelves. Here's how the SKUs break down and what you need to know.

Western Digital’s My Cloud Storage Devices Have Hard-Coded Backdoor

Western Digital's My Cloud network attached storage (NAS) devices claim to offer an easy, all-in-one solution for storing your data at home. However, they might also be providing an easy, all-in-one solution for hackers to steal your data take control of your device.

Huawei’s Phone Deal With AT&T Reportedly Killed On Account of Politics

The upcoming (and unannounced) deal with AT&T to sell the new Mate 10 series was supposed to be the start of Huawei's push into North America, but the deal has reportedly fallen apart at the last minute after AT&T got cold feet, and some sources point to a political cause.

CES 2018 in Photos: What We Remember Most

CES is always an overwhelming cacophony of sights and sounds, but a few images always stand out. Here are a few of our favorites from this year's show.