Shares of Apple fell 4% in early trading Wednesday amid concerns about demand for the company’s latest lineup of iPhones.
Apple (AAPL) is said to have abandoned efforts to increase production of its iPhone 14 lineup by 6 million units in the second half of this year after lower-than-expected demand, according to a Bloomberg report on Tuesday citing unnamed sources familiar with the matter.
The company is now said to be planning to produce about 90 million iPhone 14 units in that time period, roughly in line with the year prior, according to the report.
Apple did not immediately respond to a request for comment.
The iPhone 14 went on sale earlier this month, with mostly incremental updates. The new devices feature improved cameras and an interactive “Dynamic Island” tool for displaying notifications in place of the much-maligned notch at the top of the display. But the biggest change is arguably the lock screen, which now has an always-on display, similar to Android devices.
Like other tech companies, Apple is confronting the challenge of convincing customers to upgrade their devices — which can have four-figure price tags — amid fears of a looming global recession.
“Although Apple has been more resilient than most of its competitors and pre-orders and initial shipments of the latest iPhone 14 family have been strong, it seems the company is not immune from the broader macro-economic pressures facing many of the key markets where it operates,” said Ben Wood, an analyst at CCS Insight.
“It is always difficult to know how accurate rumors around Apple’s production plans are,” Wood added, “but it would make sense if it has decided not to make big commitments to future production increases in the current climate.”