KGI: iPhone X Shipping Estimates Improving Due To Faster Production
The better-than-expected iPhone X shipping estimates ahead of the holiday season are due to an improvement in the phone’s production instead of low demand.
According to KGI Securities analyst Ming-Chi Kuo, iPhone X production issues “have been well addressed” in recent weeks, with Foxconn’s production now at 450,000-550,000 units per day compared to just 50,000-150,000 a month or two ago as Apple geared up to launch the device. Kuo in a note to investors seen by AppleInsider says Apple and its suppliers have addressed major productions issues that plagued iPhone X output for months
Kuo estimates that Apple only had 2 to 3 million units on launch day, which explains why so few of those eager to buy it then managed to grab a unit. With production going much faster now though the company is not only able to catch up on those backorders, but also deliver new ones much faster.
Reports leading up to this month’s iPhone X debut claimed Apple and its supply partners struggled to boost device supply in the face of a variety of supply chain bottlenecks. Most focused on hardware associated with the phone’s TrueDepth camera, though Kuo in his own analysis blamed short supply on a dearth of advanced liquid crystal polymer LTE antennas.
Suppliers are also ramping up production, with Career’s LTE antenna seeing 100 percent month-on-month growth and the Dot projection module from Sharp and LG hitting 80-90 percent production yield. Kuo said last month that supply of key Face ID components was “stable” and today’s note seems to further echo that sentiment.
When the iPhone X launched, it had a shipping estimate of around 4-5 weeks but Apple has been able to bring it down to 1-2 weeks now.
Ultimately, Kuo says he is “positive on demand for iPhone X” and doesn’t agree with views that say demand for the device is weak.
In our view, Apple wants consumers to receive their iPhone X as soon as possible. With production capacity rising substantially, it is only natural that buyers are seeing a shorter shipping time.