KGI: Demand for iPhone X will outstrip supply until Q2 2018
It is often the case that new iPhone launches result in a mismatch between Apple’s ability to supply them and market demand. Therefore, it is unsurprising to learn that KGI Securities analyst Ming-Chi Kuo has formed the view that Apple won’t be able to meet demand for its flagship iPhone X at launch. What is surprising, however, is Kuo’s view that Apple won’t be able to meet demand for the iPhone X until as late as potentially Q2 of 2018.
KGI has also cut its shipping estimates as a result. It now believes that Apple will ship 40 million iPhone Xs in 2017, down from initial forecasts of between 45 to 50 million units. Of these, KGI had counted on Apple shipping two to four million units in Q3 this year. However, with pre-orders for the iPhone X only starting on October 27, Apple obviously won’t be shipping a single device during this period. KGI is still buoyant about Apple’s overall sales for the iPhone X predicting that it will ship a total of 90 million units across 2017 and 2018, which will be quite a feat for device starting from US$999.
While some have argued that Apple deliberately constrains supply of its iPhones in order to help generate hype surrounding them, at least part of the reason the iPhone X will be hard to come by is that Apple is relying entirely on Samsung Display. As the sole supplier of the AMOLED panels in the iPhone X, it has been reported that it was always going to struggle to produce enough panels at the scale that Apple requires. Apple has reportedly been in talks with LG to bring it on as a second supplier, but LG uses a plastic substrate in its OLED panels which may not meet Apple’s specifications.