July 10, 2013
OH NOES! Apple Cuts Production Of iPhones It Hasn’t Sold Yet
An analyst is once again making predictions about what Apple plans to do, an act of futility if ever there were one.
I don’t disrespect analysts or what they do. The people whom they serve are likely very glad they do the things they do, but here’s the thing; analysts rarely have any clue before the rest of us as to what Apple is going to do. Sure, they have contacts in the production side, but at this point the information they’re receiving is third hand, at best.
Ah, but I’ve gotten away from myself.
Brian Blair, an analyst with Wedge Partners, wrote a little note this week to his investors to tell them Apple is cutting their iPhone production by 20 percent in the remaining months of 2013.
Because emerging new markets aren’t interested in paying for a proper iPhone, says Blair, Apple needs to cut their production.
Now, of course, because he is an analyst, he believes strongly Apple should start offering a low cost iPhone to sell to those under developed areas of the world that don’t want to pay full price for a smartphone. I’m not saying this market doesn’t exist, I’m just saying analysts get their jollies from thinking about selling near-luxury items to developing countries. Because these new markets aren’t interested in paying for a proper iPhone, says Blair, Apple needs to cut their production.
With iPhone production cut 20 percent (and this includes whatever phones Apple releases this year, be it iPhone 5S, cheap iPhone, iPhone Math, what have you) Blair believes Apple is still on point to produce 90 to 100 million iPhones in the remaining six or so months of the year. This is still an increase of 26 percent year-over-year, however.
Apparently, Apple can cut their production of phones they haven’t even released yet and still come out on top. Last year they sold 74.7 million iPhones of varying models and this year, says Blair, they’ll make up to 100 million.
Feels like we should give them a golf clap or something.
This is a little crazy-making, of course.
Apple hasn’t even released whatever it will be that they release this year, and while they are no doubt planning ahead and shooting for a specific number of units to sell, no one has any idea until the thing(s) are released. There are those, don’t forget, who believe Apple is ripe for a flop, and though many expect the next iPhone to look much like the iPhone 5, this could backfire once it hits the market.
Might not. We just don’t know.
And it seems just a bit more than odd for a company like Apple to go into a product launch timidly, cutting production months ahead of time. In the end, it depends where Blair is getting his numbers. If he’s translating a reduction in displays to a reduction in production, then perhaps Apple just found a more efficient way to produce these screens.
Blair has a mixed track record when it comes to this kind of stuff, it should be said.
He did call out reports of a reduction in production as “erroneous” earlier this year.
On the other hand, just before the iPhone 4S released in 2011, Blair was one of those claiming a proper iPhone 5 was on the docket for that year, in addition to a 3G-enabled iPod Touch, the “cheap iPhone” of its day.
Image Credit: Apple