updated 06:07 am EDT, Tue July 9, 2013
High-end smartphone makers adjusting to tough market?
An analyst from Wedge Partners has claimed that channel checks show that Apple may have alerted suppliers to expect parts order cuts of 20 percent for June to December. If accurate, it appears to be indicative of tougher than expected market conditions for high-end smartphones. Just yesterday, both Samsung and HTC shares took a pummeling based on company profit estimates for the quarter that are lower than analyst expectations.
"So, when they make a dramatic change in their forecast, they need to let their suppliers know," analyst Brian Blair told CNBC. "And this is coming from some of our supply-chain work out of China and Taiwan that has let us know, not exactly, but that there's been roughly this kind of a change in their forecast for the period from June to December, about a 20 percent cut in what they've been telling their suppliers to be ready for," Blair added.
According to Blair, Apple had placed components orders based on its estimated demand of around 115 to 120 million iPhones. Instead, Apple now reportedly expects demand for its current parts orders to be around 90 to 100 million units. Blair also suggested that Apple may have been monitoring weakening demand for Samsung's flagship Galaxy S4 and has adjusted its parts orders accordingly. "So the bottom line is, there's lots of little signs that are pointing to slowing growth for high-end smartphones, and I think Apple's reacting to that," Blair said.
Apple's shares are currently trading at $415.05, down $2.37 from yesterday. [via Phone Arena]