Starting at $999, the iPhone X is Apple’s most advanced model to date, but it’s apparently not selling well enough to keep manufacturing at current rates. Nikkei reports that Apple is cutting iPhone X production in half due to slower-than-expected sales in the U.S., Europe, and China.
Notably, production is being ramped down on the device after it’s been on the market less than three months.
According to the report, Apple is cutting its iPhone X production targets from 40 million units in the quarter to around 20 million units, as inventories have swelled. Nikkei notes that the cuts will “have a domino effect on manufacturers” supplying parts for the iPhone X, with a likely impact totaling billions of dollars.
One possible casualty for both Apple and other manufacturers is a slowdown in their expected shifts from LED to OLED screens. Well-sourced analyst Ming-Chi Kuo has forecast that Apple will release a larger OLED version of the iPhone X and a mid-range LED model later this year.
Rumors of iPhone X production cuts have been swirling for a month, thanks to a post-Christmas report from Taiwan’s Economic Daily News, which claimed that Apple’s initial manufacturing target of 50 million units had been cut to 30 million units. Apple did not comment on that report, and its have shares dropped. Today, they’ve fallen around 2% and are near a three-month low. Over the past week, further rumors have suggested that the iPhone X will be discontinued after only a year on the market, causing some prospective customers to question its future.
Historically, Apple has refused to provide specific sales figures for individual iPhone models, saying that it wanted to keep competitors from targeting particularly popular devices. But reputable reports of large supply chain cuts can provide some insight into sales trends, as can major changes in the average selling price of iPhone devices. Apple’s quarterly earnings release on February 1 will provide further insight into the iPhone X’s impact on overall iPhone sales.