Apple reportedly cancels iPhone XR production boost

Apple reportedly cancels iPhone XR production boost

Apple reportedly cancels iPhone XR production boost

The Nikkei report comes days after Cupertino, Calif. -based Apple warned in its quarterly earnings report that sales for the crucial holiday quarter would likely miss Wall Street expectations.

The report, in Nikkei, states that demand for the iPhone XR has been "disappointing". And both the iPhone XS and iPhone XR are listed by Apple as being in stock, something Apple has found hard to do with earlier releases.

There are reports that Apple has pulled back plans for a major iPhone XR capacity boost, with Foxconn and Pegatron planning to deploy fewer manufacturing lines for Apple's cheapest premium phone. In Foxconn's case, it prepared 60 production lines for the iPhone XR, but so far has only used 45.

Five years ago, Apple cut production orders for its plastic-backed iPhone 5C a month after its launch, fueling speculation of weak demand for the model. Apple is instead apparently requesting more iPhone 8 and iPhone 8 Pluses, to the tune of 5 million additional units, for a total of 25 million older iPhone units requested for the quarter. The publication notes that Apple had previously planned 20 million units for the older iPhone models this quarter, but raised the figure to 25 million units.

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Apple's Asian suppliers tanked after a bruising day of trading after a negative report about the iPhone XR sent Apple tumbling.

A bunch of Apple's other Taiwanese suppliers fell sharply, including camera lens-maker Largan Precision Co, which was down more than 7 percent, and Flexium Interconnect, which fell 6 percent. And ultimately, after Apple's continued considerable success, I'm not willing to bet that the company got its customer read wrong this soon after the iPhone's triple launch.

The analyst predicts the company's Services business, which includes its App Store, Apple Music, and Apple Pay offerings, will grow 20% annually and rise more than $50 billion in sales by fiscal 2020. However, it doesn't bode well that the device is seeing such little demand, especially when you consider it delivers the same speed as the iPhone XS with many similar features - at a much lower cost.

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