Apple has asked its supplier to reduce production by 10% for this quarter between January to March, due to weak demands for iPhone XR and iPhone XS.
The request was made late last year to its suppliers and vindicates the reports from Citi Research that stated the sales will drop by 5-10%.
Apple’s problems compounded by the latest iPhone production cut
Apple’s troubles have continued with sliding stock prices which have dropped by 40% since October peak, weak sales of iPhones, reducing the sales and revenue forecast, and losing patent infringement cases in China and Germany against Qualcomm.
Qualcomm depositing the $1.5 billion bond to enforce the ban in Germany also means Apple has to pull certain models from the stores in Germany while they appeal against the court judgement. But the ban couldn’t have come at a worse time with Apple desperately trying to circumvent iPhone ban in China and Qualcomm fighting tooth and nails against it, it is expected Apple sales might drop further.
While the production cut is expected to affect all models of Apple’s iPhone, the biggest hit is likely to be iPhone XR, which according to analysts may face a 50% reduction in sales over the next quarter.