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Citi Research cuts estimate for Q1 production of iPhone XS Max by half

Analysts predict that Apple may cut the number of 2018 iPhones produced in Q1.
Analysts predict that Apple may cut the number of 2018 iPhones produced in Q1.
Citing predictions that the 2018 iPhone line may soon enter a destocking phase, Citi Research cut production estimates for the iPhone XR, iPhone Xs, and iPhone Xs Max by a collective 10% (50 million to 45 million). Most of this cut was driven by lowered expectations of the iPhone Xs Max; Citi Research estimates Apple will produce only half as many iPhone Xs Max units as previously predicted.

The 2018 iPhone run has had a difficult time since its launch in October. Analyst after analyst has cut their prediction for sales of the iPhone XR, Xs, and Xs Max. On Friday, Citi Research added fuel to the iPhone fire by cutting production estimates for all 2018 iPhones by 5%, including a steep 48% cut for the iPhone Xs Max.

In a statement made December 28th, analyst William Yang of Citi Research said:

The material cut in our forecasts is driven by our view that 2018 iPhone is entering a destocking phase, which does not bode well for the supply chain.

Citi Research subsequently lowered its estimate of 2018 iPhones (meaning the iPhone XR, iPhone Xs, and iPhone Xs Max) production from 50 million to 45 million units. Most of this cut concerned the iPhone Xs Max solely; Citi Research cut production estimates of Apple’s priciest flagship by half.

Citi Research isn’t the only brokerage analyst firm that has cut expectations. Last month, Apple analyst Ming-Chi Kuo cut his sales expectations for the iPhone XR by 30% for 2019Q1 and 2019Q2.

Apple itself cut orders from suppliers of iPhone components twice last month. Citing a growing malaise among smartphone consumers and an anemic Chinese market, Apple has had to temper its own expectations for sales of its latest devices.

Considering that the competition in the premium smartphone market has never been fiercer (and considering that cheaper smartphones are continually getting better), Apple already had its work cut out for it in October. Maybe releasing iterative upgrades with higher price tags wasn’t the strategy to pursue after all.

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> Notebook / Laptop Reviews and News > News > News Archive > Newsarchive 2018 12 > Citi Research cuts estimate for Q1 production of iPhone XS Max by half
Sam Medley, 2018-12-30 (Update: 2018-12-31)
Sam Medley
Sam Medley - Review Editor - @samuel_medley
I've been a "tech-head" my entire life. After graduating college with a degree in Mathematics, I worked in finance and banking a few years before taking a job as a Systems Analyst for my local school district. I started working with Notebookcheck in October of 2016 and have enjoyed writing news articles and notebook reviews. My areas of interest include the business side of technology, retro gaming, Linux, and innovative gadgets. When I'm not hunched over an electronic device or writing code for a new database, I'm either outside with my family, playing a decade-old video game, or sitting behind a drum set.