Rival Handset Makers Face Inventory Losses Following China iPhone SE Launch

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The launch of the iPhone SE in China has squeezed market share from local brands causing handset makers to rein in their inventory stockpiling for future component shipments, according to sources in the supply chain (via DigiTimes).

The introduction of the relatively low-priced iPhone SE into the Chinese market has reportedly affected the performance of brands including Huawei, Xiaomi Technology, Vivo, and Oppo. The intensified competition means handset makers are reluctant to build up inventories based on what they now perceive as over-confident shipment prospects, said the sources.

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The conservatism follows similar trends last year when shipment numbers failed to meet expectations. Camera module makers in particular were exposed to a high level of inventories in 2015 after optimistic shipment projections, but ended up shipping only 70 to 80 percent of their stockpiles. As a result, camera module suppliers have grown skeptical of prospects from vendors marketing smartphones with dual lenses.

Sources also noted that Apple's efforts to upgrade the internal voltage of its power supply devices from 15 volts to 20 volts to improve charging efficiency has left power supply makers with excessive inventories.

Apple is expected to include a dual-lens camera in the iPhone 7, set to be released in the fall of this year. However, according to respected KGI Securities analyst Ming-Chi Kuo, the dual camera will be exclusive to Apple's 5.5-inch iPhone.

Top Rated Comments

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58 months ago
The SE is a great phone for someone who does not need or want a huge phone. Apple did it right and listened to its customers for once.
Score: 11 Votes (Like | Disagree)
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58 months ago
The 4 inch size phone was always a hit. Who knows what Apple was thinking when it chose to ditch that size when introducing the iPhone 6/6S form factor. Apple should have released 6/6S in three sizes. If it had, it wouldn't have needed to create a third version of iPhone 5 and it wouldn't have the fragmentation of lacking 3D touch on a 4 inch phone either. I guess it's lesson learnt for Apple and this Chinese example further reinforces the mistake. 4 inch is a popular size, always has been, always will be.
Score: 5 Votes (Like | Disagree)
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58 months ago
But...but the arm chair execs on Macrumors and WJ analysts told me this is a flop and Apple is doomed?????
Score: 2 Votes (Like | Disagree)
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58 months ago
I'm really not sure the article makes sense. It's making out that the iPhone SE is causing phone sales of other brands to fall and affect makers of phone parts. But surely this makes no sense as contracts and numbers of parts are linked to manufacturing and there is very little stockpiling going on of these parts. They can also be sold to other buyers and would surely only affect prices at which the units are sold.

I know that while the price of the iPhone SE in USA, Europe isn't compelling. I think apple has priced it cheaper in Chinese markets.

If anything makers of inventory for phones are cutting back production for later in the year when the new iPhone comes out not now because of this phone release. This article just seems like someone attaching cause and effect that are totally unrelated.
Score: 2 Votes (Like | Disagree)
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58 months ago

Glad I'm not the only one who saw the disconnect. The connection to the SE is tenuous at best. Says right in the article that the slowdown is a continuation of a trend from last year. There was no SE last year.

Noticed the same thing. The article blends together information about handset makers and parts suppliers in a way that does not make sense.
Score: 1 Votes (Like | Disagree)
Avatar
58 months ago

I know a lot of people think the iPhone SE is stupid since it's basically the 5S, but I like it quite a bit.

Actually I think it's smart since it's basically the 6S
Score: 1 Votes (Like | Disagree)

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