Bottom line: For most, the current situation would be reason for concern but Apple isn’t in trouble yet. The company still sold a colossal 46.9 million iPhones during the previous quarter and is raking in money hand over fist. While units moved may not have increased much year-over-year, Apple is charging more per phone than it used to, resulting in better profit margins.
Additional evidence is mounting that suggests the iPhone XR may not be selling as well as Apple had anticipated.
Earlier in the month, it was reported that Apple was not making full use of assembly partners Foxconn and Pegatron. The services of Wistron, a standby assembler, would not be needed at all.
This week, reports surfaced claiming some of Apple’s key component suppliers have significantly trimmed their financial forecasts.
Lumentum Holdings Inc., the primary supplier of the Face ID technology in Apple’s iPhones, slashed $70 million off its forecast on Monday according to Reuters. Japan Display Inc. cited lower smartphone demand when trimming its outlook and British chipmaker IQE Plc also expects to generate less revenue in the current period.
Share value in Apple closed at $204.47 at the bell last Friday. As of writing, the stock is trading at $189.76.
Apple likely had some inkling that iPhone sales growth was stalling out. After all, it was revealed during its most recent earnings call that this would be the last quarter in which the company publicly shares how many devices it sells per three-month period.