The Wall Street Journal is reporting that Apple has cut component orders for the iPhone 5 due to weaker demand than expected. They cite multiple sources of whom are ‘familiar with the situation’. Demand is reportedly half of what was expected by Apple. This news comes just days after Verizon released news of smartphone activations reaching 9.8 million. Based on yearly numbers, that extrapolates out to roughly 5.3 million iPhones. While Verizon doesn’t provide raw breakouts, they did announce the numbers included a “higher mix of Apple smartphones.”
This is just one carrier and these numbers are estimates based upon previous years, but it’s the closest thing we have to actual sales and an indicator of demand. These numbers also don’t break out activations of iPhone 4S vs iPhone 5, which could also be impacting demand of the iPhone 5.
WSJ correctly notes that Apple is operating in a more competitive environment. Samsung’s product line of Android phones is the strongest it has been in years and the Android operating system has seen maturation as well. Samsung, along with other Android vendors, are seeing great demand for low-cost smartphones in China and other international markets.
If Apple is indeed seeing lower demand for the iPhone 5, maybe there is some truth to rumors that Apple will release a lower-cost smartphone.
Source: WSJ
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