(Bloomberg) -- A closely watched Apple Inc. analyst has whacked about 23 percent off his initial projections for iPhone X shipments, citing weak Chinese demand.
Apple should move 62 million units of its most expensive smartphone over its lifetime, down from an earlier estimate of 80 million, Kuo Ming-chi of KGI Securities wrote in a note dated Jan. 18. Kuo’s was the latest in a series of downgrades since December, as analysts re-assess the global reception for the U.S. company’s most advanced device. He expects production to stop sometime this year as Apple rolls out newer versions in the second half.
Apple had been counting on a redesigned 10th anniversary iPhone to boost shipments as its market value advances toward $1 trillion. But smartphone sales in China -- its most important market outside of the U.S. -- have shrunk as the market got saturated. Customers seemed to be opting for cheaper models of the iPhone, according to Cowen & Co., which said that suggested Apple failed to cram enough new technology into the iPhone X to justify its $999 price tag.
Chinese brands such as Huawei, Oppo and Xiaomi are also moving into Apple’s turf with new models designed to appeal to upscale buyers.
“High-end Chinese users adore big screen devices. But the notched design and the fact that many apps aren’t yet compatible with the device made many users think the screen of iPhone X looked smaller than the 5.5-inch iPhone,” Kuo said in his note. “The hefty price also compressed replacement demand.”
©2018 Bloomberg L.P.
With assistance from Gao Yuan