|Apple iPhone X Sales Bitten By Year Of The Dog In China |
PATRICK SEITZ12:51 PM ET
Apple ([url=]AAPL[/url]) saw weak sales of its iPhone X in China during Chinese New Year, leading one financial analyst Wednesday to cut his production forecasts for the premium smartphone for the first half of 2018.
"We are lowering our iPhone X March- and June-quarter production estimates by 2.5 (million) and 3 million units respectively, since we believe the iPhone X did not sell well during the Chinese New Year," Rosenblatt Securities analyst Jun Zhang said in a report. "We are also attributing some February iPhone X weakness in the region to consumer speculation around a cheaper, larger iPhone model later this year."
The Chinese New Year began on Feb. 16, kicking off the Year of the Dog, according to the Chinese zodiac. The holiday is a time of sales and promotions.
Zhang reiterated his buy rating on Apple stock with a price target of 180.
Apple shares were down 1.2%, near 174.60, in midday trading on the stock market today. Apple hit a record high of 180.62 on Feb. 28.
Zhang lowered his March-quarter estimate for total iPhone shipments to 50 million units from 52 million, reflecting the lower iPhone X builds.
But he maintained his June-quarter iPhone shipment estimate of 38 million units, assuming that 3 million units of a rumored red iPhone 8 will offset iPhone X cuts of a similar number.
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In addition to a new red model iPhone 8, Zhang expects Apple to come out with a second-generation version of its entry-level iPhone SE soon.
Plus, Apple is likely to release an iPad Pro tablet that features the 3D sensing feature found on the iPhone X handset. The 3D sensor allows for secure log-in with Face ID and other applications. Zhang expects the new iPad Pro to be released late in the second quarter.
This fall, Apple is widely expected to release three new iPhones: OLED-screen models with 5.8-inch and 6.5-inch displays and an LCD-screen model with a 6.1-inch display. The iPhone X currently has Apple's largest smartphone display at 5.8 inches. That premium handset retails starting at $999.
"It is our view many consumers are awaiting an expected 6.1-inch LCD iPhone — a larger-screen iPhone at a lower retail price, which is rumored to launch in September," Zhang said. "We are not surprised with the quick cool-down of iPhone X sales following Chinese New Year, and since we still believe that iPhone X production ends in June, we do not believe Apple is willing to hold any iPhone X inventory."
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