It seems as if Apple Inc. is not going to have a very Merry Christmas. The shipment projections for the iPhone X have been cut down by analysts for the first quarter next year. They have cited signs of a lukewarm demand for the phone at the end of the holiday shopping season. According to a report by analysts that surfaced on Monday, the shipment of the handsets during this period might be as low as 35 million or 10 million less than the numbers forecasted previously. While the first week of demand has been fulfilled by the company, there are worries that demand in the first quarter may be weak due to the high price tag of the iPhone X.
Apple shipped about 30 million units in the fourth quarter of 2017, but there is a possibility that shipments may be down to 25 million in the first quarter of 2018. Analysts have stated that the reduced demand is mostly because of the high price point as well as the lack of any major innovations in the device. Despite the hype and publicity, the global demand of the iPhone X doesn’t seem to be very high. As the market value of the iPhone maker is moving towards $1 trillion, it was relying on its 10th anniversary smartphone to give its shipment a boost.
The Cupertino, California based company is facing new challenges in the market, especially from Samsung Electronics Co., which has made a quick recovery after the fiasco of its Note 7 devices. Apart from that, there are also Chinese brands such as Xiaomi, Huawei and Oppo that are luring prospective customers in China and other emerging markets like India. According to some reports, Apple had forecasted sales of 50 million units in the first quarter, but has now trimmed that figure to 30 million.
It is also rumored that the main iPhone X manufacturer, Foxconn in Zhengzhou, China, has stopped hiring workers. Otherwise known as the Hon Hai Precision Industry Co., it is the sole assembler of the iPhone and also makes the devices in Chengdu and Shenzhen. The shares of other Asian suppliers of Apple fell on Monday once the report came to light. As far as the American smartphone giant has concerned, it has seen its share price rise by 51 percent, which has brought its market value to a total of $900 billion. Other analysts have said that in recent months, Apple has made a lot of efforts to increase iPhone X production and this has balanced the supply and demand of the iPhone.
It seems that customers are opting for the cheaper models of the iPhone and this means that Apple failed to cram enough innovations in the iPhone X for justifying the $999 price tag. The new features such as virtual reality and facial recognition are in accordance with Apple’s vision for smartphones in the future, but buyer interest has cooled down due to the lack of some other features such as augmented reality apps.