According to a recent report, Apple Inc. is reducing production of its entry-level smartphone by a fifth due to a drop in demand for consumer electronics, which could spell the end of the company’s longest winning streak in 2018.
An additional 1.6 percent in Monday’s decline pushed the stock further away from fully erasing its year-to-date loss after nine sessions of gains. In 2022, the stock was down just 1.6 percent as of Friday’s closing price.
Cupertino, California-based Apple plans to reduce production of iPhone SEs by about 20% next quarter compared to its original plan due to signs that consumer-electronics demand is being hurt by the war in Ukraine and rising inflation, according to unidentified sources. According to the report, the company informed multiple suppliers that it was reducing production orders by 2 million to 3 million units for the quarter.
For the first time since 2020, Apple has updated its iPhone SE line and added support for 5G networks, possibly in an effort to entice customers with older iPhones to upgrade and entice Android users to switch to Apple products.
According to a report from Nikkei, AirPod orders for 2022 have also been reduced by more than 10 million units. According to Counterpoint Research, since their 2016 release, Apple’s AirPods have become the most popular truly wireless earphones, helping the company gain a global market share of more than 25%.
Following the Nikkei report, some Apple suppliers saw their shares fall, with Qorvo Inc. down 3.3% and Varta AG down 6.5%.
Since its inception, Apple has focused on hardware, but the company has also been aggressively expanding its services business with subscriptions for music, video games, and video streaming.
“CODA” won the Best Picture Oscar on Sunday night, becoming the first streaming service to win Hollywood’s top award, beating out streaming pioneer Netflix Inc. by a solitary point.
Our analysts believe that this award will help the company grow its subscriber base and attract more A+ Hollywood talent to its platform for future projects.