Top iPhone suppliers warn of slower sales ahead of Apple results
San Francisco: Qualcomm Inc. and Broadcom Ltd, key suppliers to Apple Inc., have implied that orders related to the iPhone tailed off more than normal at this time of year.
Some of Apple’s iPhones are built with Qualcomm’s modems, which are chips for connecting to cellular networks. The San Diego-based chipmaker said Wednesday that orders from a large “thin modem” customer tailed off at worse-than-typical levels in the quarter. It was widely interpreted that the customer is Apple.
Apple reports earnings on Thursday, where it has projected revenue of $84 billion to $87 billion for the holiday quarter, including from its new flagship iPhone X, which went on sale in November. However, supply chain reports have indicated that the Cupertino, California-based technology giant has cut iPhone X orders in half for early 2018. Multiple analysts also have said the iPhone X was not the holiday smash hit that some expected.
Earlier on Wednesday, Broadcom said it expects a “greater-than-seasonal decline in wireless” components, indicating fewer than anticipated sales of its chips for its fiscal second quarter, which ends in April. Broadcom provides wireless network and Bluetooth components for the iPhone. Christopher Rolland, an analyst at Susquehanna Investment Group, pegged Apple as the reason for the order slowdown in a note Wednesday. Neither company mentioned Apple in its forecasts.
A smaller supplier, Qorvo Inc., predicted current quarter sales of as little as $645 million, missing analysts’ estimates by more than $100 million. Qorvo makes radio-frequency chips and gets about 40 percent of its sales from Apple, according to data compiled by Bloomberg.
Apple declined to comment on the suppliers’ forecasts.
A survey of seven analysts from Bloomberg estimates that Apple shipped 80 million iPhones in the holiday quarter of 2017, with an average iPhone selling price of $767, up from $695 a year earlier. Bloomberg