• iPhone Production Decreasing?

    Apple had a very good 3rd Quarter. 4th quarter may not be so hot. Analyst Craig Berger initially estimated a cut of 10% in iPhone production for fourth quarter but has re-evlauated his original estimates based some new and more recent "checks." IT now appears that the iPhone production will be dropping a more significant 40% for fourth quarter.

    While it can be interpreted as less iPhones selling that may not be the case. Apple could have a lot of stock and inventory still from 3rd quarter production that will continue being shipped out and sold at normal rates during 4th quarter. Also production and sales figures don't reflect each other perfectly so Apple could continue selling high volumes of iPhones through out 4th quarter.

    On the other hand this could also indicate Apple expecting less sales of the iPhone due to the economic issues. As Berger notes:

    "That the firm's iPhone production plans are being revised lower suggests that the global macroecomomic weakness is impacting even high-end consumers, those that are more likely to buy Apple's expensive gadgets, and that no market segment will be spared in this global downturn. This is a negative signal for global demand, in our view."

    I'd tend to agree with Berger's analysis. Worse economy = less money being spent on fancy electronic toys = less iPhone sales. It's a pretty basic conclusion to come to and not unexpected. Not even the "Jesus Phone" is immune to the economy.

    [via alleyinsider]
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