Mikey Campbell
Piling on to its own rumors of slower than expected iPhone X demand, Nikkei on Tuesday said Samsung is drastically slashing OLED output in response to Apple's supposed decision to cut production of the flagship handset.
Samsung is ratcheting down OLED panel output from its South Chungcheong plant to cover 20 million or fewer iPhone X devices for the quarter ending in March, a drastic decrease from an initial goal of 45 to 50 million units, Nikkei reports without citing sources.
According to the publication, the new target reduces plant production to roughly 60 percent of original forecasts, the publication said. In particular, output at Samsung's plant dedicated to OLED-equipped Apple devices will drop by at least 50 percent.
The Korean tech giant has reportedly not set targets for the April-June period, but further cutbacks might be required to correct for what Nikkei in past reports has described as "weak demand."
As a result of the production cut, and reduction of OLED iPhone orders, Samsung's display business is expected to suffer revenue declines for the first half of 2018. Nikkei, again without citing sources, reports Samsung made a 13.5 trillion won ($12.6 billion) capital investment to prepare for what was expected to be a glut of OLED panel orders from Apple.
After claiming Apple was looking to halve iPhone X production in January, Nikkei last week continue to pushed its narrative further, saying weak demand for this year's flagship iPhone was causing a cascade effect on the supply chain. Specifically, Samsung was last Friday said to be in search of new customers after being "saddled with excess production capacity" of OLED panels.
Earlier this month, Apple CEO Tim Cook during the company's most recent quarterly conference call earlier this month said iPhone X was the top-selling iPhone model every week since it debuted in November. While iPhone shipments were down 1.2 percent year-over-year for the first quarter of 2018, in part due to an extra sales week last year, revenue was up thanks to a record-breaking average selling price of $796.42.
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78 Comments
So, same shit as usual, halve from what exactly, Q3 numbers are already half Q1 normally.
Like I said before, analysts should be prosecuted and jailed for stock manipulations.
Notice how they didn't get traction on the 16th and now their shoveling it back out again for another go at shorting.
Considering the S9 will likely tank hard and with overall smart phone sales going down from all other android oem, it's much more that Samsung is going to be in deep doo doo. If Apple decides to go with LG for the next X, it will be even worse.
Basically, they shove Apples name in there cause saying Samsung will take a hit is not clickbait worthy, lets pull crap outta our ass and make a buck too they say.
Folk ask why Tim Cook doesn’t do more to protect the share price. This is why. How many times have we heard that you cannot glean anything from Apple’s complex supply ch— Holy cow! Is that Jony Ive … smiling??
Apple sold 77.3 million iPhones in the first fiscal for this year and had a record $88.3 billion in net sales and over $20 billion in net income. The quarter is from 9/30 to 12/30. The iPhone X was released on 11/3. It's hard to believe that the iPhone X wasn't a large part of that record quarter.
So either the iPhone X is selling incredibly well or it's not and the iPhone 8 and 8+, which were released on 9/22 sold far better than previous models.
"Supply chain checks" is like trying to project how busy the US rail network is based on the passenger count of one train pulling into Grand Central station. Flimsy doesn't even begin to grasp this method.
So of course these projections are always comically wrong, sometimes they over project, often they project far below - likely the result of the various facilities that build each part prior to final assembly, often with many facilities working on varying batches.
If making predictions (and not just headlines) we must also take into account seasonal change. If the drop is an accurate portrayal, is that the result of the transition from the holiday quarter, or a more meaningful dip? Or perhaps indicative that Apple has moved to other suppliers as already rumoured with LG.
At this stage it's borderline stock manipulation.