Apple Reportedly Cuts iPhone XS and iPhone XR Production Orders Amid Lower-Than-Expected Demand

In recent weeks, Apple slashed production orders for its latest iPhone XS, iPhone XS Max, and iPhone XR models due to "lower-than-expected demand," among other reasons, according to unnamed sources cited by The Wall Street Journal.


The report claims the production cuts have hit the iPhone XR hardest, with Apple said to have slashed its production plan for the device by "up to a third of the approximately 70 million units" it had asked some suppliers to produce between September and February, amounting to a reduction of up to 23.3 million units or so.

And in the past week, the report claims Apple told several suppliers that it cut its production plan again for the iPhone XR, as it battles a mature smartphone market and increasing competition from Chinese vendors like Huawei.

The production cuts are said to have "reignited frustration" among iPhone suppliers and "raised worries about Apple's ability to forecast demand."

We've heard this narrative before. Last year, a flurry of reports variously referred to the iPhone X as a "failure," "disappointment," and "flop." Another report said the iPhone X "did not live up to the hype." Yet, the iPhone X went on to become not only the top-selling iPhone at Apple, but in the entire world.

Apple also reported record-breaking iPhone revenue of $61.5 billion in the iPhone X launch quarter, so the device was anything but a flop.

Apple CEO Tim Cook has dismissed these kind of reports in the past. During an earnings call in January 2013, he noted that the company's supply chain is very complex and that conclusions shouldn't be drawn from singular data points:

Even if a particular data point were factual, it would be impossible to interpret that data point as to what it meant to our business. The supply chain is very complex and we have multiple sources for things. Yields can vary, supplier performance can vary. There is an inordinate long list of things that can make any single data point not a great proxy for what is going on.

Apple's financial chief Luca Maestri has also cautioned about trying to determine iPhone demand based on potentially misleading supply chain reports.

It is possible, however, that Apple is increasingly struggling to forecast iPhone demand. Today's report claims that Apple was "excessively optimistic" about its initial production forecast for the iPhone X, which it proceeded to slash "by some 20 million units" for the first three months of 2018.

Unfortunately, iPhone sales will be less transparent going forward, as Apple announced that it will no longer disclose iPhone unit sales in its earnings reports starting with the first quarter of its 2019 fiscal year.

Justifying the move, Maestri said unit sales are "not particularly relevant for our company at this point," as they are "not necessarily representative of the underlying strength of our business." He added that Apple may provide qualitative commentary related to unit sales if the info is valuable to investors.

Apple will still disclose iPhone revenue on a quarterly basis, however, and any significant year-over-year decline in that amount would help indicate if iPhone XS, iPhone XS Max, and iPhone XR demand is truly lower than expected.

AAPL is down nearly 15 percent since Apple's earnings report on November 1.

Related Roundups: iPhone XS, iPhone XR

Top Rated Comments

(View all)
Avatar
25 months ago
Need to cut the price, not the orders.
Score: 251 Votes (Like | Disagree)
Avatar
25 months ago
keep robbing your customers and eventually it's going to come back to you.
Score: 175 Votes (Like | Disagree)
Avatar
25 months ago
Deleted.
Score: 146 Votes (Like | Disagree)
Avatar
25 months ago
Good. Time to bring prices down to a sane level.
Score: 115 Votes (Like | Disagree)
Avatar
25 months ago
Apple also slashed iPhone SE production — to zero. :mad:

That's when they lost me as a phone customer.
Score: 110 Votes (Like | Disagree)
Avatar
25 months ago
Their greedy push for bigger profit margins was bound to bite them in the ass. I won't be surprised one bit if the new iPad Pro sees sales fall off as well. They can't continue to raise prices with this much competition.
Score: 97 Votes (Like | Disagree)

Top Stories

First Impressions From New iPhone 12 and 12 Pro Owners

Thursday October 22, 2020 4:20 pm PDT by
It's already Friday, October 23, in Australia and New Zealand, which means some customers who purchased an iPhone 12 or 12 Pro already have their new devices in hand. We've seen dozens of reviews of the iPhone 12 and iPhone 12 Pro from media sites, but now first impressions from regular Apple customers are available. Image via MacRumors reader Boardiesboi New iPhone 12 and 12 Pro owners are...

Early iPhone 12 Tests Show Ceramic Shield is Stronger and More Scratch Resistant Than iPhone 11 Glass

Friday October 23, 2020 1:21 pm PDT by
Apple's new iPhone 12 models are protected by a Ceramic Shield cover glass that has nano-ceramic crystals infused right into the glass to improve durability. According to Apple, Ceramic Shield offers four times better drop protection than the glass used for the iPhone 11 models. YouTube channel MobileReviewsEh conducted some tests on the iPhone 12 using a force meter to compare its performance ...

Apple Distributing New Heated Display Removal Machine for iPhone 12 Repairs

Thursday October 22, 2020 6:20 pm PDT by
Apple is providing Genius Bars and Apple Authorized Service Providers with a new heated display removal fixture for iPhone 12 and iPhone 12 Pro repairs, according to information obtained by MacRumors from a reliable source. To open iPhone 12 models, technicians will be required to slide the device into a specialized tray, and then place the tray into the high-temperature fixture for two...

Apple VP Kaiann Drance Interview Addresses Battery Life, MagSafe, and Power Adapter Concerns

Friday October 23, 2020 3:37 am PDT by
Apple's Vice President of iPhone Marketing, Kaiann Drance, has provided a new interview to Rich DeMuro on the Rich on Tech Podcast, to discuss the iPhone 12 and iPhone 12 Pro. Although much of the interview repeated points from Apple's "Hi, Speed" event, there were a number of interesting tidbits regarding the affect of 5G on battery life, MagSafe concerns, and the lack of a power adapter in...

Teardown Video Confirms iPhone 12 and iPhone 12 Pro Use Same 2,815mAh Battery

Thursday October 22, 2020 9:47 am PDT by
With the iPhone 12 launching on Friday and in just a few hours to Australia and New Zealand, hands-on videos, teardowns, reviews, and other iPhone-related content has been coming out. A new teardown video delves into both the iPhone 12 and the 12 Pro, confirming battery life for both models and giving us a closer look at their internals. The video from Io Technology is in Chinese, but ...

Images of Supposed AirPods Diagnosis Tool Shared Online

Thursday October 22, 2020 5:24 am PDT by
Apple is reportedly rolling out a new tool to Apple service providers for testing AirPods, according to leaker known as "Fudge," who shared images of the tool on Twitter. Apple appears to be seeking to reduce unnecessary AirPods services by more accurately diagnosing the cause of a fault. Instances of a dirt-blockage, which may be difficult to ascertain visually, can apparently be...

New Photos Offer Better Look at iPhone 12 Color Options

Tuesday October 20, 2020 2:34 am PDT by
As we wait for the iPhone 12 review embargo to lift later today, more pictures are circulating of the devices in real-world lighting conditions, providing a better look at the different colors available. Leaker DuanRui has shared images on Twitter of the iPhone 12 in white, black, blue, green, and (PRODUCT)RED. The black and white colors are similar to the iPhone 11 colors, but the other...

Apple's AirTags Revealed in Newly Published Patent Applications

Thursday October 22, 2020 9:13 am PDT by
Two patent applications filed by Apple appear to depict the company's widely expected AirTags item trackers (via Patently Apple). The filings, which include a large number of images, are titled "Mounting Base for a Wirelessly Locatable Tag" and "Fastener with a Constrained Retention Ring," and describe a wirelessly locatable tag that can be used to determine the absolute location of an...

iPhone 11 Pro Outlasts iPhone 12 and 12 Pro in Extensive Battery Life Test

Friday October 23, 2020 8:36 am PDT by
Arun Maini today shared a new side-by-side iPhone battery life video test on his YouTube channel Mrwhosetheboss, timing how long the new iPhone 12 and iPhone 12 Pro models last on a single charge compared to older models, with equal brightness, settings, battery health, and usage. All of the devices are running iOS 14 without a SIM card inserted. In the test, the iPhone 11 Pro outlasted both ...

Apple Warns MagSafe Charger Can Leave Circular Imprints on Leather Cases

Friday October 23, 2020 3:23 pm PDT by
If you keep your iPhone in a leather case while charging with Apple's new MagSafe Charger, the case might show circular imprints from contact with the accessory, according to a new Apple support document published today. Apple's leather cases for the iPhone 12 and iPhone 12 Pro are not available until November 6, but a MacRumors reader has already shared a photo of a circular imprint on...