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Report finds iPhone production down 40 percent

updated 12:40 pm EST, Mon November 3, 2008

iPhone production down

Apple's production of the iPhone may have fallen by 40 percent or more for the fourth quarter of the year, according to an analyst with Friedman Billings Ramsey. Craig Berger notes that the information is based on "recent checks," which suggest a radical drop in factory output, as compared to a 10 percent slide that had been predicted. A similar cut is said to have happened in the first quarter of the year, but other accounts have suggested this was planned in anticipation of the iPhone 3G.

Although cuts do not automatically imply low demand, and Apple may have ramped up its third-quarter production to an unusually high level, Berger argues that the drop is connected to economic problems. The global situation has become terrible enough, he says, that it is discouraging even the wealthy shoppers who typically buy Apple products.

Silicon Alley Insider comments that while some 6.9 million iPhones were shipped in the September quarter, approximately 2 million of these went into channel inventory.

by MacNN Staff



  1. testudo

    Joined: Dec 1969



    This can only mean one thing! Apple is skipping the much-anticipated and oft-delayed PowerBook G5 and going to surprise everyone at MW with.....the iPhone G5!

    And what would be even more unpredicatble, and thus most likely to occur, is that Apple decides to dump 3G altogether, skips over the 'current' high-end 4G stuff, and goes straight to the future: 5G!

    Then we'd have the iPhone G5 5G! Or maybe the G5 iPhone 5G!

  1. Feathers

    Joined: Dec 1969



    This is yet another analyst desperately trying to undermine APPL's share-price before the accounting period ends and his buddies have to settle their losses on shorting APPL to begin with.

  1. Guest

    Joined: Dec 1969


    @ Testudo

    As that product would be the 3rd generation iPhone, would that make it the 3G G5 iPhone 5G? Let me guess, the base unit would be the 35 Gig 3G G5 iPhone 5G going for $355.00.

    But it still won't have Cut&Past or Flash player.

  1. JulesLt

    Joined: Dec 1969


    Gloom and Doom

    I'd put it down to an entirely predictable post-launch slump - new product launch = high demand from waiting consumers, followed by a slump, followed by price cuts and slow growth.
    It's how every console/phone/etc works.

    I'm also getting fed up with all these analysts wittering on about global conditions, when to be honest no one really knows what the outcome is going to be.
    You'd think from the way some of them are acting that no one at all will be spending anything at all.

  1. ZinkDifferent

    Joined: Dec 1969



    If they were to precede their c*** with 'speculation', there would not really be any issue, but they all report it as if it were true gospel...

    Might Apple be ramping down production? Possibly.
    Would they do it while heading into the holiday season? Doubtful.

    The last time Apple reduced production of the current iPhone, what did that mean? That they ramped up production of the next model (iPhone 3G).

    Subsequently, since everyone has short memories, what was being tossed around when the original discussions of iPhones in Black and White were circulating? That a RED iPhone would join the lineup later, most likely towards the end of the year, ready for the holiday season.

    What's coming up? The holiday season!

    It doesn't take rocket science that a RED iPhone would be a great stocking stuffer, which would somewhat decrease demand in Black and White iPhones (hmmm.. maybe by 40%), so if I had to speculate (there's that word again), I'd wager that Apple is readying a new sibling to Mr. Black and Mr. White -- Mr. RED.

  1. MisterP

    Joined: Dec 1969


    Filling the Channels

    The initially high figures may be accounted for by orders to fill the various sales channels - which if you take into account the number of countries/outlets must be a massive number.

  1. bloggerblog

    Joined: Dec 1969


    RE: Filling the Channels

    At last, someone with intelligence.

  1. testudo

    Joined: Dec 1969


    Re: speculation

    You really think that the RED iPhone would someone make up 40% of the product run? I seriously doubt it. More like an initial ramp-up (as stated) to fill up the channels, then down to standard sales levels.

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