Poor holiday sales: Apple slashes iPhoneX production target by 20 million units
In what appears to be a departure from its 40 million iPhone X units quarter, Apple has notified suppliers that its iPhone X production target for the first quarter of 2018 is now 20 million units following a disappointing holiday sale, according to a report by Nikkei.
The iPhone X is the company’s most advanced smartphone yet but it also comes with a staggering price tag. While iPhones have never been cheap, the iPhone X is the most expensive one yet, sporting a $999 starting price.
The high price tag might have put off prospective customers and Apple’s holiday sales were reportedly worse than it expected. Hence, the company has decided to cut iPhone X production targets in half in the first quarter of this year. Nikkei details that the lower production target stems from disappointing holiday sales in the United States, Europe, and China.
Apple will reportedly maintain its 30 million production target for other models in the iPhone 7 and iPhone 8 series. This dramatic reduction in iPhone X production targets, however, might deal heavy blows worth billions of dollars to Apple suppliers.
“The production cuts for the X will have a domino effect on manufacturers that have supplied high-performance components for the handset, with the combined impact expected to run into billions of dollars,” says Nikkei. The iPhone X is the first smartphone from Apple to feature an organic light-emitting diode display, which is partly why it’s so expensive.
Reports indicated that the iPhone X has a high price tag because the OLED displays from Samsung are expensive. Apple could not also find another supplier that could guarantee a constant, reliable supply at lower costs. With this in mind, Nikkei also notes that Apple is now considering to lower the production of iPhone models with OLED displays and boost the production of iPhone models with LCD displays.
