AAPL stock was trading at $147.63 on Wednesday
Wednesday’s premarket trading saw a 4% decline in Apple (NASDAQ:AAPL) shares after a media report said the tech giant was abandoning plans to increase iPhone production because there was not enough demand for its whole product line. The iPhone 14 Pro model, according to Wedbush Securities analyst Dan Ives, was the “key” for Wall Street.
Ives stated that the iPhone 14 Pro mix is probably responsible for 85% of the overall iPhone 14 output, compared to 65% for the iPhone 13 line. Ives has an outperform rating and a $220 price target on Apple (AAPL).
The analyst went on to say that although the Pro model is the “primary” focus for Wall Street, news of a production cut because of weaker demand will “bring uneasiness [into] the market.” Ives furthered that the report “overshadows the underlying demand” for iPhone 14 Pro devices in an analyst note.
Ives wrote that Apple is simply shifting production from the iPhone 14 to higher-end models, which will increase the average selling price and be a “clear tailwind” for Apple going into next year. “This means much higher ASPs and a clear tailwind for Apple into [fiscal 2023] at this pace,” Ives added. The nocturnal announcement comes soon after various financial analysts emphasized the iPhone 14’s persistently high demand.
The Wave7 August survey of U.S. sales patterns, which was quoted on Monday by J.P. Morgan analyst Samik Chatterjee, showed that the market share of the iPhone 13 had decreased by about 500 basis points in advance of the release of the iPhone 14 this month. According to insiders at a major retailer, the study also stated that the new product range is anticipated to perform better than iPhone 13.
Apple (NASDAQ:AAPL) has requested Foxconn (OTCPK:FXCOF) to alter the production lines for the iPhone 14 and iPhone 14 Pro models in order to produce more iPhone 14 Pro units, according to Ming-Chi Kuo, an analyst with TF International Securities.
Bank of America, a financial services company, stated this week that Apple (AAPL) was probably benefiting from “attractive” incentives from American telecommunications companies, which are encouraging customers to upgrade to the recently introduced iPhone 14 series. Apple (AAPL), based in Cupertino, California, announced earlier this week that it would manufacture some iPhone 14 units in India.
AAPL stock outlook, forecast
Apple halted plans to boost iPhone production due to weaker-than-expected demand, which caused shares to decline in premarket trade, according to Bloomberg. The business informed its suppliers that it planned to make 90 million iPhones during the current fiscal year. Although the 90 million number is in line with the tech giant’s initial prediction from the summer, it had intended to produce up to 6 million additional devices. This year, the APPL had dropped 15%.
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