Apple Inc is backing off plans to increase production of its new iPhones this year after an anticipated surge in demand failed to materialize, people familiar with the matter said.
The Cupertino, California-based company has told suppliers to pull back from efforts to increase assembly of the iPhone 14 product family by as many as 6 million units in the second half of this year, said the people, asking not to be named as the plans are not public.
Instead, the company would aim to produce 90 million handsets for the period, about the same level as in the second half of last year and in line with Apple’s original forecast this summer, the people said.
Photo: AFP
Demand for higher-priced iPhone 14 Pro models is stronger than for the entry-level versions, some of the people said.
In at least one case, an Apple supplier is shifting production capacity from lower-priced iPhones to premium models, they added.
Apple shares fell as much as 3.3 percent in premarket trading yesterday.
US stock index futures also turned lower after the news, with contracts on the NASDAQ 100 down as much as 1.5 percent.
In Taipei, key chip supplier Taiwan Semiconductor Manufacturing Co (台積電) fell 2.2 percent and Apple’s biggest iPhone assembler, Hon Hai Precision Industry Co (鴻海精密), was down 2.9 percent, amid a wide selloff of electronics suppliers.
ASML Holding NV, maker of advanced chipmaking gear, dropped as much as 3.2 percent in Amsterdam.
Apple had upgraded its sales projections in the weeks leading up to the iPhone 14 release, and some of its suppliers had started making preparations for a 7 percent boost in orders.
An Apple spokesperson declined to comment.
China, the world’s biggest smartphone market, is in an economic slump that has hit its domestic mobile device makers and also affected iPhone sales.
Purchases of the iPhone 14 series over its first three days of availability in China were 11 percent down on its predecessor, launched last year, a Jefferies note said on Monday.
Global demand for personal electronics has also been suppressed by surging inflation, recession fears and disruption from Russia’s war in Ukraine.
The global smartphone market is projected to shrink 6.5 percent this year to 1.27 billion units, data from market tracker International Data Corp (IDC) showed.
“The supply constraints pulling down on the market since last year have eased and the industry has shifted to a demand-constrained market,” IDC research director Nabila Popal said.
“High inventory in channels and low demand with no signs of immediate recovery has OEMs [original equipment manufacturers] panicking and cutting their orders drastically for 2022,” Popal added.
WEAKER ACTIVITY: The sharpest deterioration was seen in the electronics and optical components sector, with the production index falling 13.2 points to 44.5 Taiwan’s manufacturing sector last month contracted for a second consecutive month, with the purchasing managers’ index (PMI) slipping to 48, reflecting ongoing caution over trade uncertainties, the Chung-Hua Institution for Economic Research (CIER, 中華經濟研究院) said yesterday. The decline reflects growing caution among companies amid uncertainty surrounding US tariffs, semiconductor duties and automotive import levies, and it is also likely linked to fading front-loading activity, CIER president Lien Hsien-ming (連賢明) said. “Some clients have started shifting orders to Southeast Asian countries where tariff regimes are already clear,” Lien told a news conference. Firms across the supply chain are also lowering stock levels to mitigate
Six Taiwanese companies, including contract chipmaker Taiwan Semiconductor Manufacturing Co (TSMC, 台積電), made the 2025 Fortune Global 500 list of the world’s largest firms by revenue. In a report published by New York-based Fortune magazine on Tuesday, Hon Hai Precision Industry Co (鴻海精密), also known as Foxconn Technology Group (富士康科技集團), ranked highest among Taiwanese firms, placing 28th with revenue of US$213.69 billion. Up 60 spots from last year, TSMC rose to No. 126 with US$90.16 billion in revenue, followed by Quanta Computer Inc (廣達) at 348th, Pegatron Corp (和碩) at 461st, CPC Corp, Taiwan (台灣中油) at 494th and Wistron Corp (緯創) at
NEW PRODUCTS: MediaTek plans to roll out new products this quarter, including a flagship mobile phone chip and a GB10 chip that it is codeveloping with Nvidia Corp MediaTek Inc (聯發科) yesterday projected that revenue this quarter would dip by 7 to 13 percent to between NT$130.1 billion and NT$140 billion (US$4.38 billion and US$4.71 billion), compared with NT$150.37 billion last quarter, which it attributed to subdued front-loading demand and unfavorable foreign exchange rates. The Hsinchu-based chip designer said that the forecast factored in the negative effects of an estimated 6 percent appreciation of the New Taiwan dollar against the greenback. “As some demand has been pulled into the first half of the year and resulted in a different quarterly pattern, we expect the third quarter revenue to decline sequentially,”
ASE Technology Holding Co (ASE, 日月光投控), the world’s biggest chip assembly and testing service provider, yesterday said it would boost equipment capital expenditure by up to 16 percent for this year to cope with strong customer demand for artificial intelligence (AI) applications. Aside from AI, a growing demand for semiconductors used in the automotive and industrial sectors is to drive ASE’s capacity next year, the Kaohsiung-based company said. “We do see the disparity between AI and other general sectors, and that pretty much aligns the scenario in the first half of this year,” ASE chief operating officer Tien Wu (吳田玉) told an
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