Apple continues its slide from iPhone X production cuts

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Apple continues its slide on Tuesday as more reports confirm that the company has cut production targets for the iPhone X in half.

Shares are down 0.78% to $166.57 as The Wall Street Journal confirmed previous reports saying that Apple has told its suppliers to halve production targets to 20 million units in the first quarter of the year.

The Journal’s report backed up Nikkei’s from earlier in the week. Nikkei’s report sent shares about 1% lower on Monday.

Before its announcement, many Wall Street analysts were expecting a “supercycle” of upgrades to the new iPhone. Its fresh design was the first in several generations, which was thought to be a big driver of upgrades.

Analysts are now walking back the “supercycle” predictions, citing the higher price of the new phone as one of the factors contributing to lower demand. Steven Milunovich, an analyst at UBS, said that there won’t be a supercycle in 2018 on Monday.

The company will also delay its latest update to the iPhone’s software to focus on fixing bugs and avoid recent criticism about the sloppiness of its software, according to a report from Axios.

Apple reports its holiday-quarter earnings on Thursday, and analysts are expecting a strong quarter, despite the low demand for the iPhone X. Milunovich increased his price target for Apple to $190 on Monday, citing a higher average selling price for the iPhone as a reason for increased revenue.

A majority of the 44 analysts tracked by Bloomberg rate the company a buy ahead of earnings, with just 25% of analysts rating it hold and zero rating it a sell.

Wall Street is expecting the company to report adjusted earnings of $3.83 per share on revenue of $87.132 billion.

Apple has slipped 6.11% in the last week and is down 3.32% so far this year.

Watch Apple shares trade in real time here.

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Markets Insider