Apple has reduced production orders in recent weeks for all three 2018 iPhone models, a report said Monday. The iPhone XS, XS Max and XR, unveiled in September, didn’t sell as well right off the bat as analysts expected, and Apple cast doubt about sales volumes for the current quarter as well.
Now The Wall Street Journal, citing anonymous sources, reports that Apple’s production cuts have created havoc for its suppliers.
Production requirements got thrown off by low demand among consumers and by Apple’s decision to offer three three new models (it released two each year until 2017), the report said.
Major iPhone suppliers Qorvo, Lumentum Holdings and Japan Display last week cut their quarterly profit estimates, citing an order reduction from a large customer, and as it turns out, Apple accounts for one-third to one-half of the revenue for those companies, the Journal notes.
Foxconn, the largest Chinese iPhone assembly company, cut overtime hours usually available for its workers during peak production periods.
The XR — the cheapest of the 2018 models — has proven especially challenging. It was previously reported that Apple cancelled an XR production boost, and the Journal wrote that the company told suppliers it cut its production plan further.
Apple, which didn’t immediately respond to a request for comment, said earlier this month that it won’t offer unit sales data for iPhones, iPads and Macs starting in the next quarter. Instead, it’ll focus on the revenue generated.