Recent reports indicate that production reductions have emerged shortly after Apple shares reached an unprecedented zenith.
- Apple has purportedly curtailed its component orders for the Pro models by approximately 15% to 20% for October.
- Soaring prices, partially exacerbated by a shortage of memory chips, seem to be constraining consumer demand, as reported by Nikkei.
- On Friday, retail sentiment surrounding AAPL remained decidedly ‘bearish’.
Apple Inc. (AAPL) experienced a 1.6% decline in early premarket trading on Friday, following revelations that the company had instructed certain suppliers to reduce production of components for its recently unveiled iPhone 18 Pro and iPhone 18 Pro Max. This development has stirred anxieties about demand for Apple’s latest flagship devices.
A Nikkei Asia report, drawing insights from sources privy to the situation, indicated that Apple has adopted a more cautious stance on shipments since early September, slashing component orders for October by 15% to 20% compared to initial forecasts.
AAPL Stock: Retail Traders Apprehensive About Selloff
Following the report, AAPL surged to the second position on the Stocktwits trending list, as traders expressed fears of an impending selloff, particularly after the stock reached an all-time high.
“AAPL looks dismal. Relieved I divested. No position. Rinse and repeat,” remarked one trader. Another added, The $AAPL growth narrative seems exhausted. The innovation pipeline appears scant, and the law of large numbers is catching up.
Priced for optimal success, but execution risks loom large. I’m not witnessing the upside everyone keeps proclaiming.
By early Friday, retail sentiment regarding AAPL continued to show ‘bearish’ tendencies for a second consecutive day.
Weak Demand for iPhone 18 Line
A source at the executive level informed Nikkei that orders had diminished by 15% to 20% for both premium models in October, with uncertainty persisting over how demand might shift in the ensuing months.
These cuts in target orders imply that Apple’s latest iPhones are encountering challenges in entrenching themselves with consumers at their elevated price points, complicating efforts to maintain growth via its premium hardware offerings.
Rising Prices Burden Demand
Apple unveiled the iPhone 18 Pro and Pro Max on September 9, presenting starting prices of $1,199 and $1,299, respectively—$100 more than their predecessors. Both models became available for purchase on September 18.
The elevated prices can be attributed, in part, to the ongoing memory chip shortage, which is inflating component costs and compelling consumer electronics manufacturers to impose higher prices.
Notably, Apple staggered this year’s iPhone launches to create space for its inaugural foldable phone, prioritizing three premium models while delaying the standard iPhone 18 and next-generation iPhone Air until a spring release.
AAPL Approaches Record High
This recent pullback follows a period in which Apple shares reached a historic peak. The stock closed at $340.42 on Thursday, just shy of the record closing high of $341.07 recorded on September 25. AAPL stock has risen by 25.6% year to date.
In related developments, Apple has reportedly appointed insider Steve Smith as the head of mergers and acquisitions, while transitioning Adrian Perica to its services division, according to a memo acquired by Reuters.
Perica, a seasoned veteran with over 17 years in Apple’s M&A and corporate development sectors, also assumed oversight of iCloud, Fitness+, and News, among various other enterprises, in 2023.
Source link: Stocktwits.com.
