Here’s why Apple reportedly slashed production of the iPhone X
Stagnant iPhone X sales have prompted Apple to dramatically slice production of the tech giant’s latest and most advanced handset, according to a report from the Japanese financial newspaper The Nikkei Asian Review.
Apple initially planned to produce 40 million of these handsets at its Chinese factories between January and March 2018, but Apple has reportedly cut this goal in half to 20 million.
Apparently, major markets in the U.S., China, and Europe are to blame for the now-sluggish sales after an initial buzz following the phone’s release in November.
Two obvious culprits might be contributing to the phone’s decline in sales. First, is the phone’s hefty minimum price of nearly $1,000. The other is that Apple’s main competitor, Samsung, is the main producer of the phone’s OLED displays (next-generation displays that produce sharp image quality) and can reportedly charge Apple between $120 and $130 per display.
For the 2018 iPhones, Apple is rumored to be producing a successor to the iPhone X as well as a large-screen version, dubbed the “iPhone X Plus” (which doesn’t make a ton of sense since the iPhone X is the current phone, but whatever). For those phones, Apple may have some of their OLED screens produced by the tech manufacturer LG Electronics, potentially reducing the price Apple pays for the high-definition displays.
These big cuts in production, however, don’t nearly imply that the iPhone X has flopped. Although Apple’s latest earning report hasn’t yet been released, it likely has sold millions of the new phones globally, and the product serves as Apple’s testing ground for technologies that will lay the groundwork for the iPhone for the next 10 years (e.g. Face ID). Apple knew the iPhone X was a necessary risk: Apple didn’t just offer its most expensive phone ever, it introduced the masses to a new facial recognition feature that came with both amazement and months of speculation about security concerns.
There’s also a compelling argument to be made that Apple had always planned to discontinue the phone before its first birthday in fall 2018, as Mashable’s Tech Editor Pete Pachal previously discussed. With the release of the new iPhones (including a more affordable edge-to-edge model that uses LCD screen tech) and existence of lower-cost iPhone 8 and 7 models, there might soon simply not be a place for the iPhone X in the iPhone product lineup anymore.