A senior executive from Murata Manufacturing, a key supplier of components for the iPhone X, stated that the company has not received any official notice from Apple indicating a significant reduction in the production of the iPhone X as previously reported. According to the executive, Apple has only made a minor adjustment to its production capacity, and the situation is not as severe as some media outlets have suggested.
Nikkei News recently reported that due to weaker-than-expected sales during the holiday season in major markets like Europe, the U.S., and China, Apple has informed its suppliers to cut the iPhone X's production target by half in the first quarter of this year. Originally set at 40 million units, the target was reportedly reduced to 20 million. However, Murata’s leadership disputes these figures, claiming the decline in parts supply is not as drastic as reported.
"Our understanding is that the number of parts we supply for the iPhone X has indeed decreased, but not by as much as the media has exaggerated," said Yoshitaka Fujita, vice chairman of Murata Manufacturing Co., Ltd.
Following the release of the report, Apple's stock price dropped by 1.9%. Over the past week, since January 22, the company’s shares have fallen by 4.9%, wiping out over $45 billion in market value. Despite the recent dip, many analysts remain skeptical about the iPhone X’s performance in the first quarter of 2018.
Nami-Narci Chang, an analyst at JPMorgan’s technology and semiconductor division, warned in a recent report that iPhone X orders for the first quarter would drop by 50% compared to the previous quarter. She also predicted a 33% decrease in shipments for the same period. As a result, she revised her production forecast for the iPhone X from 30 million to 20 million units. “We are seeing more signs of weak demand for the iPhone X,†she noted in the report.
Some Wall Street analysts have expressed concerns over the iPhone X’s weak demand and have even downgraded Apple’s stock this month. Earlier this month, Longbow Research lowered its rating from “buy†to “neutral,†citing expectations that iPhone shipments in fiscal year 2018 will fall short of projections. Similarly, Atlantic Securities recently downgraded Apple’s stock from “overweight†to “neutral,†citing lower-than-expected sales in the first quarter.
The ongoing uncertainty surrounding the iPhone X’s performance highlights the challenges Apple faces in maintaining strong growth in a competitive smartphone market. While the company continues to innovate, it must now navigate shifting consumer preferences and declining demand for its flagship model.
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