(Reuters) – Apple Inc (AAPL.O), which slashed its quarterly sales forecast last week, has reduced planned production for its three new iPhone models by about 10 percent for the January-March quarter, the Nikkei Asian Review reported on Wednesday.
That rare forecast cut exposed weakening iPhone demand in China, the world’s biggest smartphone market, where a slowing economy has also been buffeted by a trade war with the United States.
Many analysts and consumers have said the new iPhones are overpriced.
Apple asked its suppliers late last month to produce fewer-than-planned units of its XS, XS Max and XR models, the Nikkei reported, citing sources with knowledge of the request. (005930.KS) and Skyworks Solutions Inc (SWKS.O) flagged weak first-quarter chip demand for smartphones.
Apple’s iPhone suppliers include Taiwanese assemblers Hon Hai Precision Industry Co Ltd (Foxconn) (2317.TW) and Pegatron Corp (4938.TW). Pegatron declined to comment on the report when contacted by Reuters, while Foxconn did not immediately reply to a request for comment.
There was little reaction to the report among shares of major Apple suppliers, as the market has already digested production cuts after the iPhone maker’s forecast cut, analysts said.
Shares of Foxconn, the world’s biggest electronics contract manufacturer, were up 1.6 percent while Pegatron was up 1.3 percent.
Among iPhone component suppliers in Asia, South Korea’s LG Display Co Ltd (034220.KS) was up 0.5 percent, while Japan Display Inc (6740.T) was flat.
As Chinese demand has faltered, Apple has increased focus on India, which recently overtook the United States as the world’s second-largest smartphone market.
Chief Executive Tim Cook reiterated in an interview with CNBC on Tuesday that India was a major focus for Apple.
Reuters reported last month that Apple will begin assembling its top-end iPhones in India through the local unit of Foxconn this year, citing a person familiar with the matter.
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