KGI: iPhone 7 demand has peaked, suppliers to revise down forecasts
Though Apple is still showing shipment delays on iPhone 7 Plus orders — and Jet Black iPhone 7 units — noted KGI analyst Ming-Chi Kuo infers early buzz around Apple's latest flagship smartphone is flagging, and as such believes overall shipments have peaked.
In a note to investors obtained by AppleInsider, Kuo backs up his peak iPhone shipment prediction by pointing to immediate availability in many global markets. In particular, the 4.7-inch iPhone 7, which accounts for a bulk of Apple's annual iPhone sales, is for the most part in stock around the world.
Reiterating sentiment from a report earlier this month, Kuo says Apple is seeing lower than expected demand due to a lack of "spec surprises" in the 4.7-inch model. Further, improved delivery estimates for 5.5-inch iPhone 7 Plus units, which quickly sold out after the phone's September launch, suggests slowing demand.
Kuo said he expects iPhone suppliers to revise down shipment forecasts by 5 percent to 15 percent in November to December. The analyst updates his overall iPhone component shipment timeline to 80-85 million units in the fourth quarter of 2016, down from a previous estimate of 85-90 million units.
The analyst also cut shipment forecasts for iPhone 7 component shipments in 2016 to 90-95 million units, down from 95-100 million units. Kuo's end-shipment forecast is unchanged from September at 70-75 million units.
The estimates are in contrast to reports from Asian parts suppliers who noted a dramatic increase in iPhone component orders near the end of September. At the time, supply chain resources estimated Apple to produce 80-84 million iPhones before the end of 2016.
The final iPhone tally remains up in the air largely due to Samsung's Galaxy Note 7 recall, an event that left component suppliers scrambling. In late October, Apple was said to be increasing production of iPhone 7 and 7 Plus orders to take advantage of the snafu. What part those orders play in supply chain estimates, if any, is at this point unclear.