Contact us  Enter Chinese version>>
Home Price Center Market News Company Data Download CFMS 2018
iPhone supply chain bracing for impacts
Source: DIGITIMES   Editor: AVA   Update Time :2019/1/7 16:29:45

The supply chain of iPhone devices is bracing for major turbulence after Apple lowered its guidance for its fiscal first-quarter 2019 ended December 29, 2018 due to weak sales of its smartphones in China, according to industry sources.

Apple slashed its revenue guidance for the latest quarter to US$84 billion, a shortfall of at least US$5 billion from its previous guidance of US$89-93 billion.

There had been frequent speculation about poor iPhone sales during the last quarter of 2018 - speculation fuled by revelations of sluggish performance at a number of Apple's key component suppliers, and the US vendor's unusal promotional activities.

The US-China trade war clearly has played a part in the poor iPhone sales, but some other market observers said that there are bottlenecks inside Apple such as its high pricing strategy and a slowdown of its innovative dynamics that have made new iPhones less attractive to consumers.

In response to the emerging trends and service applications such as 5G, IoT, AR, VR, smart home, smart retailing, edging computing and cloud integration, Apple has so far been slow to react, added the sources.

While a number of rival brands are foraying into the development of 5G-focused smartphones, there has been speculation that Apple may not launch 5G models until 2020. If that is the case, makers in the iPhone supply chain will face more uncertainties.

With the absence of 5G phones, Apple is likely to adopt a more aggressive pricing strategy to maintain the sales momentum of iPhone devices in 2019, and this could be achieved at the expense of component suppliers, said the sources.

Supply chain makers have to make fast responses to slowing sales of iPhones, given that they are facing rising land, production and labor costs in China, as well as increasing competition from local component suppliers. The options for them include moving their production bases to other emerging markets such as India and also considering the possibility of building production facilities in the US.

Home | About ChinaFlashMarket | Privacy policy | Contact us | Help
© 2008-2019 Shenzhen Flashmarket Information Co., Ltd. All rights reserved