Several analysts interviewed recently by The Wall Street Journal opined that iPhone 7’s supposed lack of compelling features probably convinced many owners of the exploding Note 7 to opt for another high-end Galaxy handset, and not Apple’s flagship phone.
Their remarks were corroborated today by supplier data collected by Japanese newspaper Nikkei Asian Review, which claims Apple is planning to cut iPhone 7 and iPhone 7 Plus orders by ten percent starting in the first quarter of 2017 after they “sold more sluggishly than expected”.
Apple did something similar late in 2015 when accumulated iPhone 6s inventory caused it to slash output during the January-March 2016 period. Learning from this, Apple allegedly curbed iPhone 7 production by around 20 percent, but that obviously wasn’t enough as orders will be cut by an additional ten percent in 2017.
Although iPhone 7 Plus remains popular, Nikkei says that a shortage of camera sensors has limited Apple’s ability to meet demand for the phones. A source at a major parts producer called the latest iPhone 7 production cuts “within expectations”.
Nikkei’s conclusions about the alleged iPhone 7 manufacturing downturn were derived from its own calculations, working from the data obtained from multiple suppliers in Apple’s supply chain. It’s also important to remember that sales always struggle in the typical seasonal decline a few months after the latest iPhones launch.
In other words, orders go down every year in the first quarter because the initial rush to buy a brand spanking new iPhone is typically gone after the holiday shopping season. Of course, production cuts also may have something to do with Apple rehashing the same old iPhone 6 design for three years in a row.