March 28 (Reuters) – Apple Inc (AAPL.O) is planning to reduce production of iPhone and AirPods due to lack of demand due to Ukraine crisis and rising inflation, Nikkei newspaper reported on Monday, sources briefed on the matter said. Reported citing
The report added that the company plans to produce 20% less iPhone SE – or about 2 million to 3 million units – in the next quarter compared to the original plan. It added that Apple has also reduced its 2022 orders for AirPods by more than 10 million units.
Apple, whose shares were down about 2% in premarket trading, did not immediately respond to a Reuters request for comment.
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News of weak demand mirrors forecasts from analysts who have warned that rising inflation due to COVID-19 lockdowns in Chinese cities and the Ukraine conflict could hit smartphone demand this year.
The new iPhone SE is displayed during an event at Apple Headquarters in Cupertino, California on March 21, 2016. Reuters/Stephen Lam
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Analysts have said that Apple, in particular, faces challenges from the lack of design upgrades for the latest SE and a $30 increase in its price from the 2020 model.
Ming-Chi Kuo at TF International Securities on Monday slashed its shipment estimate for the iPhone SE to between 15 million and 20 million units this year, from 30 million units from 25 million previously.
“It looks very similar to the iPhone SE (2020), the second upgrade to the iPhone 8, and is less likely to dampen consumer demand,” said Taiwan-based Isaiah Research analyst Eddie Han while cutting down on his forecast sales for the model. Said happened. From 5 million units.
Apple is expected to launch an all-new iPhone lineup later this year, but analysts say it’s too early to predict any impact on the upcoming range.
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Reporting by Jhanvi Nidumolu and Nivedita Balu in Bengaluru; Editing by Anil D’Silva and Aditya Sonik
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