Apple Inc. (Nasdaq: AAPL) stock took a beating after reports in Taiwan said Apple may have aggressively cut its first-quarter iPhone X sales forecast from 50 million units to 30 million. The iPhone news is part of a tumultuous finish to a strong year for Apple, but investors seem to be taking the news mostly in stride.
On Monday, Bloomberg reported the reduced iPhone X forecast, citing a report by the Taiwanese newspaper Economic Daily Times. The Economic Daily Times reportedly spoke with an iPhone supply chain official and noted that iPhone manufacturer Foxconn has stopped recruiting workers.
The news prompted analysts to reduce their forecasts for first quarter iPhone shipments. Sinolink Securities said Apple may ship as few as 10 million iPhone Xs in the quarter.
“After the first wave of demand has been fulfilled, the market now worries that the high price of the iPhone X may weaken demand in the first quarter,” analyst Zhang Bin wrote, according to Bloomberg.
Other analysts jumped in to defend Apple and iPhone demand. Rosenblatt Securities analyst Jun Zhang says the reports in Taiwan may be referencing iPhone 8 and iPhone 8 Plus production cuts rather than iPhone X cuts. Zhang says he sees “no evidence” of cuts to iPhone X-specific components, such as 3-D sensing and OLED panels.
“Overall, iPhone component suppliers could see a 25 percent decline [quarter-over-quarter] in the March quarter; however, iPhone X component suppliers would still see a flat sequential March quarter,” Zhang says.
Lackluster iPhone X demand isn’t the only issue weighing on Apple stock this week. Last week, the company admitted to purposefully slowing down older model iPhones in what the company claims is an effort to help the devices handle aging batteries. In the wake of the news, there have now been eight new lawsuits filed against Apple by iPhone users alleging Apple defrauded them by not initially disclosing the slowdown.
Investors have also been criticizing Apple for missing a golden opportunity by not getting its HomePod smart speaker device to market by the holiday shopping season. Amazon.com (AMZN) reported that its smart speaker, the Echo, was its top-selling product this holiday season. The HomePod is expected out in early 2018.
Market fallout from all the bad news seems…
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