Apple to cut iPhone production by 10% this quarter

Apple chief executive Tim Cook

Apple chief executive Tim Cook

Apple has asked reportedly its suppliers to manufacture fewer iPhones than planned for January to March, affecting both older iPhone models and the firm's flagship iPhone XS, XS Max, and XR models.

In 2018, Apple's stock went down 6.79%, thus, it again underperformed the S&P 500, which registered a 6.24% loss.

Nikkei said Apple has reduced its planned production for the period and will only ship about 40 million to 43 million devices, instead of the 47 million to 48 million units it had originally reckoned. However, compared to the sales of iPhone X, which was pricier than iPhone XR, the iPhone XR was 50% lower in sales.

Apple blamed the growing tension on import fees between China and the United States as one of the reasons iPhone sales are going down. A small slump in iPhone sales aside, the company has seen good sales of iPads, Apple Watch, AirPods, and Macbooks - with the diversity of products ensuring protection against unexpected dips in revenue.

Reuters reports that market research firm Canalys is expecting smartphone shipments in China to fall three percent in 2019 after a 12-percent decline past year.

Apple also said that it will stop disclosing iPhone shipments, starting from the October-December quarter this year. Next, Apple (NASDAQ:AAPL) pulled a rare move (at least for Apple) and lowered its own guidance down just two days in the new year. This latest request was allegedly made before Apple issued a warning on its revenues on 2 January, in which it said revenue for the final three months of 2018 would be around $84bn (£66.8bn). Apple suppliers, including Britain's Renishaw, were hit by the sell-off.

Shares of Foxconn, the world's biggest electronics contract manufacturer, were up 1.6 percent while Pegatron was up 1.3 percent. A lack of upgrades in more advanced markets has also resulted in Apple's downfall.

Chief Executive Tim Cook reiterated in an interview with CNBC on Tuesday that India was a major focus for Apple.

Because Apple preannounced slower sales in Q4, the Nikkei is making out that Apple ordering 10 less iPhone for Q1 is some huge revelation.

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