Apple seen cutting iPhone 5 part orders due to weak demand

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?