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Apple’s December Quarter For iPhone 16 Shipments “Looks Increasingly At Risk”, As The Company Cuts Production By Three Million Units

Apple’s December Quarter For iPhone 16 Shipments “Looks Increasingly At Risk”, As The Company Cuts Production By Three Million Units

rewrite this title Apple’s December Quarter For iPhone 16 Shipments “Looks Increasingly At Risk”, As The Company Cuts Production By Three Million Units

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Apple announced the iPhone 16 and iPhone 16 Pro models last year, and the devices are expected to do pretty well in sales. Part of the reason why speculations suggest an upward trend is Apple Intelligence, but based on recent information, the iPhone 16 could see production cuts later this year.

iPhone 16 shipments to take a hit in the December quarter, and there are various reasons why the devices will see a three million production cut

Barclays analysts have shared their investor notes, which reveal how the iPhone 16 is doing and what can be expected from the device in the forthcoming quarters. The analysts report that Apple “may have just cut” iPhone 16 production by three million units, which were made for a semiconductor component, according to supply chain checks (via 9to5mac).

To be precise, Barclays suggests that these checks suggest that the iPhone 16 shipments will decline by 15 percent year-over-year, but the performance for the previous quarter will be on par with earlier expectations. The September quarter for the iPhone 16 shipments will bring 51 million units. The report also mentions that the iPhone 16 models have two additional days of sell-through compared to the iPhone 15 models.

As for the last quarter of this year, covering October, November, and December, the iPhone 16 shipment appears to be at dire risk, based on information derived from the Barclays report. The analysts also coin that the December quarter for the iPhone 16 shipments “looks increasingly at risk” as Apple has cut down orders for the iPhone 16 production. The analysts also share that the lack of demand is probably due to the poor rollout strategy of Apple Intelligence.

We think Sep-Q iPhone units are on track for 51M as the best case (consensus and Barclays both at 51M for Sep-Q estimate), assuming some channel fill in line or better vs. last year due to more selling days. We believe July and August sell-through has been flattish Y/Y.

Apple Intelligence is expected to arrive later this month, possibly on the 15th, but the rollout remains uncertain, with features divided into various updates. This could make some users reluctant to upgrade to the latest models at this stage. Furthermore, Apple Intelligence or any AI features have limited adoption outside of the United States, which could potentially allow global shipments to remain low.

Another reason the December quarter could take a hit is the lack of innovation in terms of design, as the ‘Pro’ models look almost identical to last year’s iPhone 15 Pro models. It remains to be seen how the real world responds to these factors, as it is too early to draw a conclusion about whether the iPhone 16 lineup is a hit or a miss this year. We will keep you updated on the demand for devices, so do stick around for more.

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