The iPhone XR may not be selling as well as Apple hoped.
According to a report Monday by Japan's Nikkei, Apple "signaled disappointing demand" for the iPhone XR by informing manufacturing partners Foxconn and Pegatron to halt plans for additional production lines of the smartphone targeted at price-conscious consumers. Weakened demand for smartphones globally might not hurt Apple's revenue too much, but suppliers could feel the strain.
Cutting corners: iPhone manufacturers are not able to make full use of their production capabilities and are closing down unneeded assembly lines. However, the update also brought the Performance Management for the battery to iPhone 8, iPhone 8 Plus and the iPhone X. The feature is enabled by default and will start throttling performance as soon as it detects a drop in consistency from the power reserve.
It's too early to tell if the iPhone XR will have a similar fate as the iPhone 5C.
Meanwhile, Pegatron, which is another key partner of the Cupertino-based tech giant, has had to "suspend plans to ramp up production", now "awaiting further instructions", according to supply chain sources that are typically right about these things.
The Nikkei, citing supply chain sources, said Apple had also asked smaller iPhone assembler Wistron to stand by for rush orders, but that the company will receive no orders for the iPhone XR this season. Originally Apple had ordered 20 million of the last generation model but has since raised the order to 25 million.
This information may help explain why Apple provided a dim forecast for iPhone sales in the current quarter.
A bunch of Apple's other Taiwanese suppliers fell sharply, including camera lens-maker Largan Precision Co Ltd, which was down more than 7 per cent, and Flexium Interconnect Inc, which fell 6 per cent.