Apple, the manufacturers of iPhone, plans to reduce the iPhone 7 production by 10% in early 2017, according to data collected by Nikkei. The company experienced the same situation, thanks to accumulated inventory of the iPhone 6s late in 2015, which also caused it to lower output of iPhone in first quarter of 2016.
Company tried to prevent the same situation this time with iPhone 7 by reducing the production in 2016, but even with that precautionary move, Apple is again looking at a manufacturing downturn in the new year.
Reasons behind the cut down
In the report, Nikkei cites “sluggish” global sales for the iPhone 7 as the main reason behind the move. Because of this, the production cuts are expected to be focused on the iPhone 7 and iPhone 7 Plus.
Apple could’ve taken advantage of Samsung’s Galaxy Note 7 problems this year, but instead they failed to capitalize. According to the analysis, iPhone 7 lacked “compelling” features and failed to garner interest in the new smartphone line. Throughout the year, a “doom and gloom” sentiment has followed the company ever since it reported its first revenue decline in thirteen years.
Later this year in 2017, Apple will launch its next generation mobile phone, which is expected to have OLED display and is rumored to come in three different sizes.