Apple Inc (AAPL) Cuts iPhone 16 Production Orders Amid Weak Demand - Barclays Analysts
Apple Inc (AAPL) has reportedly reduced its iPhone 16 production orders by 3 million units, signaling weak demand for the latest model. Barclays analysts noted that this is the earliest build cut in recent history, with sell-through checks pointing to a 15% decline in global iPhone 16 sales compared to last year.
Following this news, Apple shares dropped more than 3% after the market open. Barclays maintains an Underweight (UW) rating on Apple stock, citing factors such as weaker consumer spending, macroeconomic pressures, and increased competition. Additionally, the delayed rollout of Apple Intelligence may impact iPhone 16 sales in key markets like China and Europe.
Barclays projects iPhone unit sales for the September quarter to reach 51 million, with the earlier launch of iPhone 16 adding two days of sales to the quarter. However, the December quarter is said to be "increasingly at risk" due to recent order cuts and underwhelming sell-throughs.
Citi analysts have also revised their iPhone unit forecasts, lowering expectations for the September and December quarters while increasing shipments for March and June 2025. They anticipate iPhone shipments for calendar years 2024 and 2025 to reach 224 million and 246 million, respectively.
In conclusion, the reduced iPhone 16 production orders and potential impact on sales highlight the importance of monitoring market trends and customer feedback. Investors should consider the implications of weaker demand on Apple's stock performance and future growth prospects.