Apple seen cutting iPhone 5 part orders due to weak demand

By , Jan 14, 2013

iPhone 5 Apple Store

The Wall Street Journal issued a report late last night, claiming that it had it on good authority that Apple has been telling its suppliers to cut their iPhone 5 part orders due to, what is believed to be, weak demand.

The publication’s sources, who — you guessed it, are familiar with the situation — say that Apple has cut orders for multiple iPhone 5 components, but say screen orders specifically have been cut by nearly 50 percent…

From The Journal’s report:

“Apple Inc. AAPL -0.61% has cut its orders for components for the iPhone 5 due to weaker-than-expected demand, people familiar with the situation said Monday.

Apple’s orders for iPhone 5 screens for the January-March quarter, for example, have dropped to roughly half of what the company had previously planned to order, two of the people said.”

As aforementioned, the cuts suggest that the iPhone 5 is seeing weaker-than-expected demand, in the face of strong competition from Samsung and Google. And if you’re Apple, or one of its investors, this scares you.

This isn’t the first time we’ve heard that Apple was trimming their iPhone part orders. There have been multiple, similar reports over the past few months, and Reuters corroborated the story yesterday with a different source:

“Apple has asked suppliers Japan Display Inc, Sharp Corp and South Korean company LG Display Co Ltd, to cut supply, down from an initial plan to order about 65 million units in the quarter, the Japanese daily said.”

It’s worth noting that it’s not too unusual for iPhone demand to start dipping at the 6 month mark — especially after the holidays. The early adopters are gone, and other buyers are beginning to look to the next-gen handset.

And that could certainly be true this time around, as there’s been talk that Apple is going to break its annual refresh cycle and introduce the next iPhone in the first half of 2013. There’s also word of a cheaper model in the works.

But are any of these things enough to cause Apple to reduce iPhone component orders by 50%? I don’t know. But I do know that Apple’s earnings call is in a few weeks, and it’ll be real interesting to hear its next-quarter projections.

What do you make of all of this?

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  • http://twitter.com/therealjdizzle Jason Masters

    Business as usual.

  • momerathe

    I just don’t think it’s a hugely compelling upgrade; those who disagree have bought it, and the rest (like me) are content to hold on to their 4/4S.

    • aj

      Exactly what I tell people. iPhone 5 is nothing but a 4S with an extra row of icons. What do we do of this extra row of icon? Ofcource, the people too desperate for that extra row will go and buy it but other than that it is just an iPhone 4/4S. Have a look at the Samsung Galaxy Note 2, its screen is gigantic but it is not just for an extra row of icons over the S3. It is for the S Pen, multi window and many other functionalities. Ofcource, I don’t say that it is better than the iPhone, but it is better than its older brothers (the S3 and the orignal Note) and shows a lot of improvement. Where as the iPhone 5 is no different than the iPhone 4S (except the extra row of icons and specs). I believe that Apple has already set the bar too high. The bar is so high that not even Apple is being able to think of crossing it again. What we expect from an iPhone is to be radically different from its older brothers. Apple has stroked a little too late and now the iron is cold. The competition has reached its neck.

      • http://www.facebook.com/joe.jonsen Joe Jonsen

        the 5 is more like a “iphone4S2″

      • jilex

        just saying, but the S3 only misses the S-Pen, the other capabilities are available on the latest update (you can also install the nexus 4 camera to get photosphere)

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      3Gs to the 4 was apple best upgrade… 4S perfected the “4″ but the 5 was just a badly executed attempt at a next get iphone.. the 5 is great but should have been a lot more coming from the perfect 4S..

      • aj

        Dude i agree that the 4S on paper was perfect but after a 15 months wait for it, having the same look of the 4 makes it not so perfect

  • Mohammad Ridwan

    Let the ‘Apple is Doomed’ comments come…

    • http://twitter.com/jimbosl86890688 jimbo slice

      apple is DOOMED!

  • http://twitter.com/arskka ArthurT

    Good, we deserve more from apple, and I’m not taking about just a big screen…

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      they have no steve so they are stuck..

  • http://twitter.com/TimothyBryant94 Timothy Bryant™

    Make iOS open source. Bam! Now you have so many orders you can’t keep up with demand.

    • Dan

      In our dreams :(

    • Blake

      I see why people might think that is desirable. But that is why Android has so many issues. It is obviously open source. That allows carriers to load on whatever crappy bloat ware that they please. That is also why there are so many viruses. As well as a shit ton of horrendous apps!

      • notewar

        not to offend your point but to uninstall something isnt it just tapand delete the icon? Unless it is deeply integrated then that would be another story.

      • Blake

        I understand what you are saying. But the bloatware that he companies put on the phones can not be removed unless you root your device and then delete it, which would still be a undesirable task.

      • aj

        I agree with ur point but majority of people on this site would have a jailbroken iDevice and rooting in android world is something simmilar to jailbreaking and as for as my experience goes, rooting is far simpler than jailbreaking. And those who can jailbreak can surely root an android phone. Plus, once you root, the root you choose provides u with your choice of apps without the help of downloading it from cydia. I know that my last sentence maybe a lil confusing but what I mean to say is that when you jailbreak your iPhone, an appstore named Cydia appears on your homescreen and then you choose your mods from it; in here the first headache is jailbreak and then downloading tweaks and if u have an untethered jailbreak, your iphone’s at a loss for tons of minutes. Whereas when u download a rom on ur android phone, there are no external app stores and what you wanted, come when you download tge rom itself

      • http://www.facebook.com/joe.jonsen Joe Jonsen

        but android sucks tho

      • aj

        Yup android sux..it is just an open source copy of iOS

      • jilex

        and if you dont want to root, just flash another room for an android

      • https://twitter.com/MrElectrifyer MrElectrifyer

        No, he’s using the wrong technical phrases. iOS doesn’t need to be open source, it just needs to be more open to user customization (not carrier/retailer customization).

        All that’s required to make that a reality is stock installation of Cydia with just its default repos (no option to add repos, thus no *simple* piracy).

      • jilex

        thats right too, but the biggest problem in android is the fragmentation, maybe if apple could no make iOS open source, they let the final user to customize their devices, if not like the jailbreak, putting the icons in other ways and the sortcuts in the NC would do a good start (sorry for my bad english, im mexican) and they can hire some jailbreak devs to start with the innovative part in the iOS, i guess this could be a good start

    • tv_gadget

      people dont care about open source anymore, but what we need is real multitasking, i understand that iphone 4,4s wasnt powerful enough to run 2 apps at once but the iphone 5!! im not asking to change the UI im just asking them to add basic features that has been available on other OSes for years!!!

      • http://www.facebook.com/joe.jonsen Joe Jonsen

        iphone 4S is more than powerful enough tok do it there was a jailbreak tweak that allowed it but the dev is gone and its broken..

    • Manuel Angel

      We don’t need iOS to be open sourced. What we need is better talent at jail breaks.

      Comex left, Geohot, quit for newer things, Pod2G has moved on a bit into making apps for the App Store. These people were great, but now we don’t have much people to go on.

      Close-sourced didn’t stop these people from cracking codes, so I’m sure new people will come.

  • http://www.facebook.com/shingo.hoshino Shingo Hoshino

    apple stocks drop to 100 pless……..ahhahahahahha

  • http://twitter.com/forgottentowel forgottentowel

    Or maybe they cut back screen orders because the iPod touch uses the same exact display and that the big iPod season just ended?

    Doomed I tell you, DOOMED!

  • http://twitter.com/MOHAMMEDAWSOE mohamed ali mohamed

    Lol
    Just to tell you guys ,the sentence (weaker than expected demand) is different from (weak demand)
    65million is still a big big number

    • aj

      Lolzz..i guess that u r a nut shell. The article clearly suggest that the final order is not more than the half of the previously expected order. That means that, the number has fallen from 130 million to 65 million which is a big drop. Although 65 million is still a huge no., it is nothing as compared to 130 million. Drunckheads.!!

      • http://www.facebook.com/joe.jonsen Joe Jonsen

        I really dont see how apple expects to keep folks buying iPhones when they have kept selling older cheaper ones the prices are still to high and the updates are to minimal…llol old rich executives always make this mistakes after a while..

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      yeah capitalist great expect massive profit increases no matter what..

  • http://www.facebook.com/ledzeppelin96 Stanley Traub

    Galaxy S3 FTW!

    • http://www.clubnokiard.com/ Frankie Bloise

      Lumia 920″

      • http://www.facebook.com/joe.jonsen Joe Jonsen

        great phone but it runs a crappie OS

      • jilex

        that’s still growing, maybe they get better

  • Africanking

    Great news. Next iPhone should be something new and different. If not, then I’ll keep my iPhone 4s jailbtoken one.

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      my 5 will be my lat iPhone for awhile i hope the jailbreak comes soon so i can sell my damn 4S..

  • Bscaine

    The guy with the ideas in Apple died so i will Apple. The iPhone 5 was a total fiasco. No improvements but troubles and ugly in comparison with the previous releases. Apple most be take smart actions in order to stay on top.

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      I agree… apple needs a new steve,… the current CEO is just a damn joke..

  • Mohammad Ridwan

    This is what happens when make it hard to Jailbreak… See Tim…Please let us Jailbreak… Why take the fun out…??

    • http://www.facebook.com/joe.jonsen Joe Jonsen

      so true IOS is like a damn 10 hour funeral when its not jailbroken