Apple iPhone XR shipment forecast slashed by analyst Ming-Chi Kuo, due to weak demand. (Image source: Reuters)
Apple’s iPhone XR might not be the hotseller that analysts had predicted with noted analyst Ming-Chi Kuo slashing shipment forecast for the device. According to a report on MacRumors, the analyst has given several reasons for slashing iPhone XR’s shipment forecast, including the higher price and competition from Chinese players like Huawei.
For iPhone XR, the estimate has gone from 100 million to 70 million for fourth quarter 2018 to third quarter 2019, which is a drastic cut. According to Kuo, consumers expected a lot more affordable pricing for the iPhone XR, which has not really happened considering it starts at $749 in the US. In India, the price starts at Rs 76,000, which still makes it much more expensive that most other Android phones in the market.
The analyst in his research note has also said that customers expect dual-cameras and a narrower bezel at this price point. He also expects tough competition from Huawei’s Mate 20 series, and that there were will negative impact due to the trade war in China, which is one of the most important markets for Apple.
Kuo has reduced “his overall iPhone shipment forecasts by 15–20 percent for the first quarter of 2019,” notes the report. “We have reduced our XR shipment estimations for 4Q18, 1Q19, and 2Q19 by 30–35%, 25–30%, and 25–30% to 30–35, 20–25, and 10–15mn units, respectively,” he said in his note.
He also expects Apple’s first-quarter estimate for iPhones to stand at 47–52 million, which is down from the earlier prediction of 55–60 million.
Kuo is not the first analyst talking about how the iPhone XR has not lived up to expectations. In the opening sales weekend, Apple Insider had quoted analyst Jun Zhang of Rosenblatt Securities as saying that the iPhone XR did not meet sales expectations. He had also predicted that Apple will reduce iPhone XR and iPhone XS production in November and December.
Meanwhile, Apple’s shares have fallen by as much as 5 per cent yesterday over reports of shrinking demand and slashing of orders. One Apple supplier, Lumentum which is the primary one for the technology that powers Face ID feature of iPhones, said that an unnamed largest customer had slashed orders. This is believed to be Apple.
Other Apple suppliers have also lowered forecasts due to the company slashing orders and seen their shares fall. Earlier Japan’s Nikkei has reported that Apple had told its smartphone assemblers Foxconn and Pegatron to halt plans for additional production lines dedicated to its new iPhone XR.
With Reuters inputs