Apple's Suppliers Projecting Weak Demand for iPhone 7 Due to 'Lack of Innovation'

fv_iphone_7_render_bottomApple recently reported its first year-over-year decline in iPhone sales, with CEO Tim Cook claiming one of the reasons is that the upgrade cycle for the larger iPhone 6 and iPhone 6s series has stretched out longer than it anticipated.

Despite the launch of the lower-priced iPhone SE, that decline is expected to continue into the second half of this year. In reporting its first negative-growth quarter since 2003, Apple forecasted another revenue drop next quarter.

The sales decline is placing downward pressure on Apple's overseas suppliers, who have ridden the iPhone's coattails to success over the past half-dozen years. Not only does LCD supplier Japan Display reportedly expect to post a nearly $300 million loss for the fiscal year ended March, but Nikkei reports that Apple's slowdown is also sending Taiwanese suppliers into a downward spiral.

"Suppliers are saying that they are getting fewer orders for the second half of this year compared with the year-ago period," a source said. "The traditional peak season this year will not be able to compare to the past few years."

The report claims Taiwanese Semiconductor Manufacturing Company (TSMC), one of Apple's primary chip suppliers, may ship up to 30% fewer chips in the second half of 2016 compared to the year-ago period. The decline is attributed to the iPhone 7's expected lack of innovative features, saturation of the smartphone market, increased competition, and a global economic slowdown.

Another source said that for Taiwan Semiconductor Manufacturing Company, the sole supplier for the latest A10 chips used in iPhone 7, its iPhone 6s and iPhone 7 chip shipments for the June to December period will likely shrink to 70%--80% of the level reached in the second half of 2015.

Apple suppliers Largan Precision, LG Display, Catcher Technology, Foxconn, and Pegatron have and will likely continue to face similar declines in the near term.

Largan Precision, a key high-end camera module supplier for Apple's iPhone, reported its first year-on-year decline in revenue in three years in the last quarter of 2015. The company has suffered a revenue fall for five months in a row since last December.

Adam Lin, chief executive of Largan, attributed the dip to a "significant scale-back of orders from a major customer."

Apple is expected to announce the iPhone 7 and iPhone 7 Plus, the latter of which may be branded with a "Pro" name instead, in September. Newly leaked drawings suggest both smartphones may have no 3.5mm headphone jack and a single speaker, while a dual-lens camera system and Smart Connector will seemingly be exclusive to the larger 5.5-inch model with 3GB of RAM.

Related Forum: iPhone

Top Rated Comments

chrismail627 Avatar
79 months ago
Finally someone acknowledges the lack of innovation! Hopefully Apple gets a wake up call.
Score: 35 Votes (Like | Disagree)
nelmat Avatar
79 months ago
I'm really losing patience with Apple. Massive product line-ups, confusing for the average purchaser. No fresh design, slow/sloppy implementation of software, services and hardware. It really does feel like a downward slope.

Of course, the company can afford to let things slide a bit, they're no going bust any time soon, but I'm considering a move away from Apple for the first time since 1987. I've drunk the cool-aid, my entire ecosystem is Apple, but I'm about done. AirDrop is a mess, hand-off works when it feels like it, software updates are hidden and unclear, search in App Store and iTunes Store is flakey at best. iLife and iWork suites are forgotten and left in the dust by free and inexpensive software from small developers.

Where is the excitement, where is the fun? It really is stagnant.

Just my opinion, others will disagree with me, but surely all will agree there's been nothing exciting for a couple of years. No more 'one more thing'. The iPad is dead, the Mac Pro stagnant, the Thunderbolt Display as good as a fossil. It's a real shame. Incremental updates, while sucking all the colour out of the world.
Score: 28 Votes (Like | Disagree)
ericgtr12 Avatar
79 months ago
It's far more about marketing than innovation at this point.
Score: 21 Votes (Like | Disagree)
sputnikv Avatar
79 months ago
this is pathetic
Score: 18 Votes (Like | Disagree)
btrach144 Avatar
79 months ago
The rumored 2018 iPhone should be coming out in 2017. Apple is losing control... or maybe Tim Cook is losing control of Apple.
Score: 15 Votes (Like | Disagree)
Sloppy.Joe Avatar
79 months ago
Is the iPhone 7 out already? I must have missed it.

Obviously we know everything about the iP7 and have reached an accurate conclusion that it lacks innovation.

Good thing no one has jumped to conclusions.
Score: 15 Votes (Like | Disagree)

Popular Stories

maxresdefault

Unbox Therapy Shares Hands-On Look at iPhone 14 Pro Max Replica

Monday May 16, 2022 4:40 am PDT by
YouTuber Unbox Therapy has shared a hands-on look at the iPhone 14 Pro Max using what he claims is a one-to-one replica created by third-party case makers with access to detailed schematics and dimensions for Apple's new upcoming flagship smartphone. As with the iPhone 13 Pro lineup, in 2022, we are expecting a 6.1-inch iPhone 14 Pro and a 6.7-inch iPhone 14 Pro Max, but this time the Pro...
macOS Monterey 2

Apple Releases macOS Monterey 12.4 With Support for Studio Display Webcam Update

Monday May 16, 2022 10:10 am PDT by
Apple today released macOS Monterey 12.4, the fourth major update to the macOS Monterey operating system that launched in October 2021. macOS Monterey 12.4 comes over two months after the launch of macOS Monterey 12.3, an update that added Universal Control. The ‌‌‌‌‌macOS Monterey‌‌ 12.4 update can be downloaded on all eligible Macs using the Software Update section of System...
iOS 15

Apple Releases iOS 15.5 and iPadOS 15.5 With Wallet and Podcast Updates

Monday May 16, 2022 10:00 am PDT by
Apple today released iOS 15.5 and iPadOS 15.5, the fifth major updates to the iOS and iPadOS 15 operating systems that were initially released in September 2021. iOS and iPadOS 15.5 come a little over two months after the launch of iOS 15.4 and iPadOS 15.4. The iOS 15.5 and iPadOS 15.5 updates can be downloaded for free and the software is available on all eligible devices over-the-air in...
iOS 16 mock for article

Gurman: iOS 16 to Include New Ways of System Interaction and 'Fresh Apple Apps'

Sunday May 15, 2022 6:14 am PDT by
iOS 16 will include new ways of interacting with the system and some "fresh Apple apps," Bloomberg's Mark Gurman has said, offering some more detail on what Apple has in store for the upcoming release of iOS and iPadOS set to be announced in a few weeks at WWDC. In the latest edition of his Power On newsletter, Gurman wrote that while iOS 16 is not likely to introduce a major face-lift to...
Prosser Series 8 3

Apple Watch Series 8 Rumored to Feature New Design With Flat Display

Wednesday May 18, 2022 6:21 am PDT by
The Apple Watch Series 8 could feature an all-new design with a flat display, according to the leaker known as "ShrimpApplePro." In his latest video on the YouTube channel Front Page Tech, Jon Prosser highlighted information from ShrimpApplePro that suggests the Apple Watch Series 8 could feature a flat display in what seems to be a design originally rumored for the Apple Watch Series 7. ...
Whatsapp Feature

WhatsApp to Let Users Leave Group Chats 'Silently' and View Rich Link Previews in Status Updates

Tuesday May 17, 2022 3:07 am PDT by
WhatsApp is working on a new feature that will allow users to "silently" leave group chats hosted by the messaging platform instead of all members of the group being notified when they do. As it stands, when someone leaves a group chat, WhatsApp announces their exit to the entire group, making the act of leaving very public. It's not possible right now to leave a group quietly, but WhatsApp...
apple tv 4k design green

Apple Releases tvOS 15.5 for Apple TV HD and Apple TV 4K

Monday May 16, 2022 9:57 am PDT by
Apple today released tvOS 15.5, the fifth major update to the tvOS operating system that first launched in September 2021. tvOS 15.5 comes more than two months after the release of tvOS 15.4, an update that brought support for captive WiFi networks. tvOS 15.5 can be downloaded over the air on the Apple TV through the Settings app by going to System > Software Update. ‌‌‌‌‌‌Apple...