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An iPhone a year keeps the customers away.
That's a stark new lesson for Apple, which reportedly told its suppliers this week that demand for its brand new iPhone 13 is falling in advance of the holidays. With a mix of customer fatigue and economic uncertainty, there's no sign of demand ticking up in the New Year, either.
Slumping Demand Still Means Record Profits
Every year, Apple hosts rock concert style events where its new products debut to tech consumer fanfare unlike any other — turning the launch of new phones into a cultural event as much as a business one. But this year's iPhone 13 wasn't exactly world shattering, featuring only some minor upgrades to processing power and camera functions.
That doesn't appear to have cut it. According to sources who spoke to Bloomberg, the tech giant has begin notifying suppliers that some of their orders may never materialize, months after it already cut production numbers due to supply chain woes:
- Before the demand slump, Apple already slashed its 2021 production target for iPhone 13 down 10 million units, down to 90 million total because not enough parts were available.
- There's still no need to spare sympathy for Tim Cook and Co: even with demand trending downward, Apple is on pace for a record $117.9 billion in sales in the final three month of 2021, according to Wall Street analysts — they'll have to settle for a less gigantic quarter than expected.
Haters Gonna Hate: Apple shares fell over 3% in early trading Thursday, but one analyst was emphatic that present concerns are a big fat nothing. "The haters will continue to hate on Apple, but we believe a $3 trillion market cap is in the crystal ball despite these negative white knuckle headlines worrying the Street," Wedbush securities managing director Dan Ives told the New York Post.