Falling iPhone Sales Has Apple Investors Spooked

Falling iPhone Sales Has Apple Investors Spooked

Early sales reports were positive, and Morgan Stanley reported last week that the iPhone X is especially hot in China.

Wall Street's main indexes came under pressure on Tuesday following a 2.5 percent drop in Apple's shares on a report of weak iPhone X demand.

Apple looks like it's having a not-so Merry Christmas. Citing the device's expensive $999 price point, Sinolink Securities Co. analyst Zhang Bin said that iPhone X sales for the current quarter may check in at 35 million units, about 10 million fewer units than some analysts have been projecting. According to Zhang, the production cut being referred to in these reports is actually for the Apple iPhone 8 and Apple iPhone 8 Plus.

JL Warren Capital LLC also said that iPhone X shipments may fall to 25 million in the first quarter of 2018, down from 30 million in the fourth quarter of 2017.

Apple has been counting on a redesigned 10th anniversary iPhone to boost shipments as its market value advances towards US$1 trillion (S$1.35 trillion).

But the first wave of demand among Apple fanatics seems to have passed, and analysts are skeptical that more casual iPhone customers will upgrade to the iPhone X.

The California-based company is facing new challenges from South Korea's Samsung Electronics, which is quickly recovering from the Galaxy Note 7's recall after fires. It sports a 4-inch Retina IPS LCD display and is powered by the company's A9 chipset.

Apple has received a less-than-desirable sales prediction for the first quarter of 2018. The tech-heavy Nasdaq fell 0.37 percent to 6,934.14 as high-flying names such as Facebook, Amazon, Alphabet and Netflix declined. Lens recovered some of the losses yesterday, while Largan continued to slide. Touch-screen maker General Interface Solution Holding plunged 8.4 per cent yesterday after slipping slightly on Monday.

Santa didn't deliver as many iPhones as Apple shareholders would've liked this year.

Other independent analysts are seeing problems in Apple's future as well. It's much easier to get one now, which could be because of increased production, lower than expected demand, or a combination of both.