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iPhone orders 'significantly' reduced as Apple begins prepping for next-gen model

post #1 of 25
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Apple has begun drawing down build plans for its current iPhone models, as sales begin to ease in anticipation of a new sixth-generation model expected to launch later this year.

Analyst Shaw Wu with Sterne Agee said in a note to investors on Tuesday that he has found in his checks with suppliers that Apple has reduced iPhone orders by between 20 and 25 percent from the 35.1 million units the company shipped in the March quarter.

If those numbers hold for the current June quarter, that would result in shipments of between 26 million and 28 million iPhones. That result would be below Wall Street consensus of between 30 million and 31 million.

Wu also noted that investors should factor in the 8.6 million iPhones Apple has in the channel inventory, with 2.6 million added in the most recent quarter. That channel inventory allowed the company to reach a supply-demand balance of between 4 and 6 weeks.

"From our understanding, the reason for the reduction is not demand related but rather due to the upcoming 6th generation iPhone refresh likely in the September-October timeframe," Wu wrote. "It appears AAPL is opting to be conservative with its suppliers to factor in a potential 2-quarter pause ahead of the refresh and also to manage inventory."

iPhone 4S


Last year, Apple reported record sales of 20.34 million iPhones during the June quarter. That bested analyst expectations, which were as low as 15.8 million.

But in the following September quarter, iPhone sales were 17.07 million, or 21 percent year over year growth, as Apple drew down inventories ahead of the iPhone 4S launch. That came in below expectations, as analysts predicted sales of around 20 million iPhones for the quarter.

Wu noted that Wall Street consensus last year "grossly underestimated the impact of a pause and inventory drawdown ahead of the iPhone 4S." He believes investor expectations should be drawn in for the June quarter as well as the following September quarter.

But while he doesn't expect a significant upside for iPhone sales in the coming quarters, Wu does believe the iPad has the potential to impress investors. Specifically, he has heard that Apple has increased build plans for its third-generation tablet.

Previously, shipments of the new iPad were held back by manufacturing issues with the new high-resolution Retina display. Earlier this month, estimated shipping times improved to between 3 and 5 business days as availability improved.

Wu said Retina display availability has been addressed by adding an additional supplier, beyond Samsung. He believes this will allow Apple to meet strong demand for the new iPad in the coming quarters, enabling the company to deliver upside compared to consensus investor expectations.
post #2 of 25
What an idiot.

First, there's no reason to believe that he has any idea what's going on based on his history. But even if he does, his 'reduced expectations' are for a 30% increase over last year's June quarter. Why the negativism?
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Gatorguy 5/31/13
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post #3 of 25
fantastic!... I was worried that Apple was not going to produce a new iPhone! /sarcasm
Ah, Yes September is when school is in session, and Apple "Schools" the Cell phone industry...
so june is out of the question?...
post #4 of 25

This all reminds me of the 'experts' at the start of the season discussing which team will win the Super Bowl and why or which horse will win the Derby and why .....

Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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Been using Apple since Apple ][ - Long on AAPL so biased
nMac Pro 6 Core, MacBookPro i7, MacBookPro i5, iPhones 5 and 5s, iPad Air, 2013 Mac mini, SE30, IIFx, Towers; G4 & G3.
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post #5 of 25

Anal .....yst... Just so stupid.  Sheeeze!!  Do these guys ever get it right or do they just throw a deck of cards up in the air to make their predictions.???

post #6 of 25

As soon as I see analyst.. I ignore it.

 

They get more wrong, than they get right.  That said, I dont think there's a snowballs chance in hell that we wont see a completely redesigned 4G/LTE iPhone5 with a bigger screen in the next 6 months.  As a 4 & 4S owner.. network speed & small screen are truly my only major complaints.  I would think most people owning a 4 or 4S would agree.

post #7 of 25
Quote:
Originally Posted by Daekwan View Post

 a completely redesigned 4G/LTE iPhone5 with a bigger screen in the next 6 months.  As a 4 & 4S owner.. network speed & small screen are truly my only major complaints.  I would think most people owning a 4 or 4S would agree.

 

 

Just so long as they don't increase the size of the case.   Any bigger than it is and it will not fit into anybody's pocket.

 

Apple tested every size of device, and determined that the current size is the perfect size.  Any other size is less good.

post #8 of 25
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post


Just so long as they don't increase the size of the case.   Any bigger than it is and it will not fit into anybody's pocket.

Apple tested every size of device, and determined that the current size is the perfect size.  Any other size is less good.

I'll take a slightly bigger screen (3.75" - 4") as long as it is the same ratio/pixel dimensions and not much bigger footprint.
post #9 of 25
Quote:
Originally Posted by starbird73 View Post

Quote:
Originally Posted by I am a Zither Zather Zuzz View Post


Just so long as they don't increase the size of the case.   Any bigger than it is and it will not fit into anybody's pocket.

Apple tested every size of device, and determined that the current size is the perfect size.  Any other size is less good.

I'll take a slightly bigger screen (3.75" - 4") as long as it is the same ratio/pixel dimensions and not much bigger footprint.

 

Most people like the size of the iPhone screen.

post #10 of 25

Quote:
Originally Posted by starbird73 View Post

Quote:
Originally Posted by I am a Zither Zather Zuzz View Post


Just so long as they don't increase the size of the case.   Any bigger than it is and it will not fit into anybody's pocket.

Apple tested every size of device, and determined that the current size is the perfect size.  Any other size is less good.

I'll take a slightly bigger screen (3.75" - 4") as long as it is the same ratio/pixel dimensions and not much bigger footprint.

 

Most people like the size of the iPhone screen.  They don't wear clown pants.

 

Apple has managed to sell more iPhones than anybody else, and all of them have a 3.5" screen.  People who like crappy big screens already have lots of choices, and the iPhone still outsells every Android phone on the market.

post #11 of 25
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post


Don't get me wrong, I am fine with the current size. I was just saying if they feel compelled to go bigger, don't change the ratio or add more pixels.
post #12 of 25

General question....have ANY of the analysts so often mentioned in articles ever:

 

  1. Ran a successful company?
  2. Ran a successful supply chain?
  3. Ran anything successful at all?
  4. Made a million with their ideas?
  5. Change how people do things in their day to day life?
  6. etc
  7. etc

 

Just asking...

post #13 of 25
Quote:
Originally Posted by jragosta View Post

What an idiot.
First, there's no reason to believe that he has any idea what's going on based on his history. But even if he does, his 'reduced expectations' are for a 30% increase over last year's June quarter. Why the negativism?

 

It's not a case of him being an idiot so much as this is a total NSS (No s*it sherlock) bit of info. Of course Apple is going to reduce their buy on a model that is about to disappear or turn into the mid level model. They do it every year. 

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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post #14 of 25
Quote:
Originally Posted by haar View Post

fantastic!... I was worried that Apple was not going to produce a new iPhone! /sarcasm
Ah, Yes September is when school is in session, and Apple "Schools" the Cell phone industry...
so june is out of the question?...

 

I would say yes. Based on last years tactic it appears Apple has moved the iPhone to the Fall where they can pick up sales in the last quarter that they weren't getting with the iPod line up. the iPad has Spring covered and Back to School sales for the Macs in the Summer make it the thing to focus on with new hardware possibly coming out to grab interest and sales. Winter of course has the holidays so it needs no real help. 

 

Also, getting the iPhone announcement out of WWDC loosens up the time table in the same way that getting out of MacWorld a couple of years ago did for the company. And it allows Apple to put the conference focus back on their software. We'll probably get a couple of tidbits about the new phone if something would be leaked by the iOS 6 betas but that's all. 

A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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A non tech's thoughts on Apple stuff 

(She's family so I'm a little biased)

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post #15 of 25
Quote:
Originally Posted by icoco3 View Post

General question....have ANY of the analysts so often mentioned in articles ever:

 

  1. Ran a successful company?
  2. Ran a successful supply chain?
  3. Ran anything successful at all?
  4. Made a million with their ideas?
  5. Change how people do things in their day to day life?
  6. etc
  7. etc

 

Just asking...


That's why they are analysts. They failed at everything else.

post #16 of 25
Quote:
Originally Posted by AppleInsider View Post

Apple has reduced iPhone orders by between 20 and 25 percent from the 35.1 million units the company shipped in the March quarter.

 

If true, it means that Apple is only ordering parts (flash memory modules) for the 8GB iPhone 4S.  Right now, Apple ships the 3GS and 4 with 8GB of flash memory, so when the "new iPhone" is released, the 4S will likely be limited to 8GB as well.

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post #17 of 25
Quote:
Originally Posted by jungmark View Post


That's why they are analysts. They failed at everything else.

 

And they're all trying to become the next rock star analyst by making a prediction that nobody else does, then having it come true by some miracle of fortune.  Being a rock star analyst means corporations will pay you to write private reports for them and then pay you to write public reports that say the exact opposite.  Or something like that.  But the rock star analogy holds.

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post #18 of 25

Thhe problem with Apple is because there is only one model of iPhone. More models will smooth the demand and earnings from old to new models.

post #19 of 25
Quote:
Originally Posted by peter236 View Post
Thhe problem with Apple is because there is only one model of iPhone. More models will smooth the demand and earnings from old to new models.

 

Yeah, the fact that their single model outsells every other phone on the planet is the problem.


The fact that their THREE YEAR OLD SINGLE MODEL still outsells every other phone on the planet is the problem.

 

I don't get it. Apple sells three models of iPhone at once, and they're the top three selling phones. We don't need different sizes and we don't need more "models".

Originally Posted by Slurpy

There's just a TINY chance that Apple will also be able to figure out payments. Oh wait, they did already… …and you’re already fucked.

 

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Originally Posted by Slurpy

There's just a TINY chance that Apple will also be able to figure out payments. Oh wait, they did already… …and you’re already fucked.

 

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post #20 of 25
Quote:
Originally Posted by Tallest Skil View Post

 

Yeah, the fact that their single model outsells every other phone on the planet is the problem.


The fact that their THREE YEAR OLD SINGLE MODEL still outsells every other phone on the planet is the problem.

 

I don't get it. Apple sells three models of iPhone at once, and they're the top three selling phones. We don't need different sizes and we don't need more "models".


That is why Android models outsell the 3 iPhone models, 2 of which are outdated. The Android ecosystem is large than the IOS ecosystem.

post #21 of 25
Quote:
Originally Posted by peter236 View Post
That is why Android models outsell the 3 iPhone models, 2 of which are outdated. The Android ecosystem is large than the IOS ecosystem.

 

No, it's not. They flood the market with cheap crap and dozens upon dozens of models, don't release numbers of shipped OR sold, and don't care about selling any device at all. Android phones, the newest phones, are buy one get one free. And they count that as "sold". That's why a three year old iPhone sells better than even the newest Android phone. People want iPhones, not Android phones, as evidenced by more people buying a three year old iPhone than a brand new Android device.

Originally Posted by Slurpy

There's just a TINY chance that Apple will also be able to figure out payments. Oh wait, they did already… …and you’re already fucked.

 

Reply

Originally Posted by Slurpy

There's just a TINY chance that Apple will also be able to figure out payments. Oh wait, they did already… …and you’re already fucked.

 

Reply
post #22 of 25
Quote:
Originally Posted by I am a Zither Zather Zuzz View Post

 

 

Just so long as they don't increase the size of the case.   Any bigger than it is and it will not fit into anybody's pocket.

 

Apple tested every size of device, and determined that the current size is the perfect size.  Any other size is less good.

 

Funny. My wife is a size 3, and her HTC One X fits in her pocket just fine, even when she wears skinny jeans. I sure it won't break any hearts if Apple finds a happy medium between the current size, and the One X's dimensions. The 3.5" screen was fine in the past, but everytime I borrow her phone to look at a webpage, youtube clip or map, I find my 4 severely lacking.

post #23 of 25

Interesting. It wasn't until well into summer that Apple began drawing down on orders for the current model. This, along with the retailer discounts announced last week, would indicate that the next iphone will either be launched sooner than September/October, or Apple has a boatload more unsold handsets sitting in their warehouses than they did this time last year.
 

post #24 of 25

I don't think they really like the size of the screen, but the size of the Iphone itself...in comparison to other phones it actually is/was really handy...But now HTC released some phones with bigger screen, but actually the same size as the Iphone => handy phone with bigger screen :) they just left out the "Home Button" I guess ;)
 

post #25 of 25
Quote:
Originally Posted by peter236 View Post


That is why Android models outsell the 3 iPhone models, 2 of which are outdated.

That part is true. 5,000 different Android phones from dozens of manufacturers outsell Apple's 3 phones. However, that kind of fragmentation means that few of the Android phone companies are making money and none are making as much as Apple. Furthermore, it means a zillion different products which is bad for consumers. Try getting a matching case. Or spare parts if it breaks. Or support of any type.

Maybe someday they Android phone developers will learn that it makes more sense to put lots of effort into a smaller number of devices rather than spewing 5,000 different models to try to match every single possible customer desire.
Quote:
Originally Posted by peter236 View Post

The Android ecosystem is large than the IOS ecosystem.

That part is probably false - depending on how you define 'ecosystem'.

There are far more apps on the iOS ecosystem.
Phones are used far more heavily for web access on the iOS ecosystem.
Developers make far more money on the iOS ecosystem.
Advertisers make far more money on the iOS ecosystem.

Keep in mind that the Android numbers include phones that are really no better than feature phones and can't even be considered smart phones. And, of course, the fact that none of the Android phone makers actually releases sales numbers, so it's just a guess.

So, if by 'ecosystem', you mean "I bought a crap phone that's useless, so it's sitting in a drawer somewhere", you might be right. But if you're referring to the actual use of phones, you're probably wrong.
"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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"I'm way over my head when it comes to technical issues like this"
Gatorguy 5/31/13
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