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Apple’s Asia suppliers fall on report iPhone XR production boost canceled

08 November 2018

According to Nikkei, this means that Foxconn will be producing almost 100,000 units less every day based on the new estimates available. The iPhone XR hit shelves in October, undercutting the iPhone XS by $250 despite offering much the same style and abilities.

The analyst predicts the company's Services business, which includes its App Store, Apple Music, and Apple Pay offerings, will grow 20% annually and rise more than $50 billion in sales by fiscal 2020.

Whilst iPhone XR demand has not met expectations, reports claim Apple has requested more iPhone 8 and iPhone 8 Plus models.

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"The utilisation for the XR production is not reaching its maximum capacity now", the report added. As a result, Foxconn will build 100,000 fewer units every single day than would have happened under Apple's original order.

Sources told the publication that Foxconn had initially prepared almost 60 production lines for the production of iPhone XR.

Pegatron apparently faces a similar situation, suspending plans to ramp up production of the iPhone XR and simply awaiting further instructions from Apple at this time.

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Apple began shipping the iPhone XR on Oct 26 after two weeks of pre orders. Surprisingly the company asked assemblers for more production of iPhone 8 and iPhone 8 Plus units.

This information may help explain why Apple provided a dim forecast for iPhone sales in the current quarter.

And are you surprised by the low demand for the iPhone XR? It's entirely possible that the reason Apple doesn't need very many XR's is that most customers are choosing the highest-end models or defaulting to the lower-end, cheaper products. According to the report, demand is still strong for those models and Apple not expects to produce 25 million iPhone 8 and iPhone 8 Plus units during the fourth quarter.

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Skyworks, a US-based supplier of semiconductors, reportedly failed to meet Apple's famously stringent quality standards for printed circuit boards (PCBs), which made the smartphone manufacturer "quickly drop" its orders.

Apple’s Asia suppliers fall on report iPhone XR production boost canceled