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iPhone X hype hasn’t stopped Apple’s shares from slipping

by Peter A. McKay
Oct 19 2017, 12:02am

Apple fanboys and fangirls these days are eagerly awaiting release of the company’s tricked-out iPhone X in November. But in the meantime, some of the hardware giant’s less heralded products are hitting unexpected obstacles overseas.

Several downbeat press reports Thursday weighed on Apple shares, which recently traded almost 3 percent lower. The bad news included:

  • A report in the Economic Times, a Taiwanese business newspaper, that Apple recently cut orders to local suppliers who make the iPhone 8 by 50 percent, suggesting weak demand for the device.
  • Joe Natale, chief executive of Canadian cellular provider Rogers Communications, said that iPhone 8 demand at his company’s stores has been “anemic,” according to Reuters.
  • The Wall Street Journal reported that cellular connections for the new Apple Watch have abruptly been shut off in China, apparently due to the government’s concerns about its ability to track users of the device. The new model is the first to have its own cellular antenna, versus older models of the watch that had to pair with an iPhone in order to share a connection.

Considering Apple’s heavy reliance these days on mobile devices to drive growth, none of this is good. Apple shares have risen more than twelvefold since the introduction of the iPhone in January 2007.

Amid Thursday’s pullback, some Apple fans on Wall Street advised to keep that longer-term winning streak in mind. Many are still looking ahead hopefully to the release of the iPhone X on Nov. 3 as an event that will boost Apple’s sales. The new model starts at $999 and operates entirely on touch and voice recognition, with no “home” button.

In reports to clients, several analysts on Thursday said it may be that Apple is purposefully shifting resources from producing the iPhone 8 to the X. If so, the reports of reduced supplier orders may not turn out to be a big deal, as long as the X sells as quickly as expected.

“The overall iPhone production is largely on track,” Deutsche Bank analysts wrote.