“Weaker-than-expected-demand” of iPhone 5 is not right and the report of iPhone 5S production

iPhone 5 (Credit: CNET)

Two days back, reports of “Weaker-than-expected-demand” of the components of iPhone 5 start circulating on internet that resulted in reduction of Apple’s stock market.

However, recently Sterne Agee analyst Shaw Wu wrote in a research note to the investors that the demands of the iPhone 5 didn’t go down and the Apple’s reported lowered demands of the components is due to “much improved yields meaning lower component builds and supplier shifts.”

“We believe there is great confusion with press reports of order cuts and weak demand. From our understanding, the reason is two-fold: (1) much improved yields meaning lower component builds and (2) supplier shifts. As far as we can tell, iPhone 5 demand remains robust,” Wu said in a statement.

On the other hand, Jeffries analyst Peter Misek came with the said in a statement of initial production of iPhone 5S that will start in March for a June/July launch.

“As word of the earlier production schedule starts to spread, we believe we could see a slight slowing of demand CQ1 in anticipation of the new product launch and Apple will likely start curtailing channel inventory. Therefore we tweak down our CQ1 iPhone shipment estimate from 48M to 44M, which is still well above widespread fears of shipments in the mid-30Ms.”

Misek has also commented on the lowered demands. According to Misek, main points are; “1) an assembly bottleneck caused component inventories to rise in CQ4; 2) new iPhone builds starting in March; 3) demand being in line to slightly below optimistic expectations.”


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