Apple Inc. has told its suppliers to reduce production of new iPhones for the January-March quarter by about 10%, trimming its manufacturing plans for the second time in two months, Nikkei Asian Review reported, citing sources with knowledge of the matter.
The request was reportedly sent out a week before the company revealed Jan. 2 that it will miss revenue forecasts at the end of 2018. Apple now expects revenue of US$84 billion for the quarter ended Dec. 29, 2018, down from its earlier guidance of US$89 billion to US$93 billion.
The sudden lowering of its revenue forecast for the holiday quarter sent Wall Street into a frenzy, leading several analysts to downgrade the iPhone maker's stock.
Apple cut production orders for all three of the iPhone models that it unveiled in September. In the second revised plan, all new iPhone devices such as the XS Max, XS and XR have been taken into account, according to sources cited in the report. The overall production volumes of old and new iPhones will be reduced to 40 million to 43 million units for the January-March quarter, down from an earlier projection of 47 million to 48 million, the report said.
Earlier, Apple told smartphone assemblers Hon Hai Precision Industry Co. Ltd. and Pegatron Corp. to cancel plans for additional production lines for the manufacturing of the iPhone XR.