WSJ revises story about Apple iPhone 5c production cuts

WSJ revises story about Apple iPhone 5c production cuts
On Wednesday, we passed along a story about production cuts being ordered by Apple for the Apple iPhone 5c. The story, which was sourced from the Wall Street Journal, revealed that Apple had reduced its orders for the iPhone 5c by 20% from Pegatron and by 33% from Foxconn. At the same time, the report when on to add that Apple had increased orders for the the full-featured Apple iPhone 5s. The businessman's bible, as the paper is known, did not list the number of units of each model being produced, the actual number of units being cut, and the new quantities of each model expected to be built after the changes.

Later in the day, the WSJ continued to press the idea that the offering a lower priced iPhone 5c was a strategy that wasn't working. The paper quoted an executive from Orange who said that the Apple iPhone 5c "isn't selling as well as expected because it is too expensive, and the older iPhone 4S remains an attractive, cheaper option." The latest stats show the Apple iPhone 5s making up 64% of iPhone sales with the mid-range Apple iPhone 5c at 27%. So what exactly is the problem here? Apple is selling a large number of its more expensive model. This was something that the Wall Street Journal finally caught on to with the next edition of the story which included this statement: "the fact that the 5C appears to have missed Apple's expectations may not be all bad, especially if it means consumers are buying more of the 5S, the higher-end iPhone that came out at the same time last month and sells for $100 more."

The main problem is too much reliance by the WSJ on the "supply chain" for information. Apple CEO Tim Cook even warned analysts in January that "the supply chain is very complex, and we obviously have multiple sources for things. Even if a particular data point were factual, it would be impossible to interpret that data point as to what it meant for our business." 
 
Finally, we should point out that the Journal also was forced to backtrack a statement it had made about price cuts for the iPhone 5c proving that demand for the model was week. Stats generated by Canaccord Genuity from the top four carriers in the U.S. show that in September, the Apple iPhone 5c was no lower than the third best selling phone for each of those top mobile operators. On half of them, the iPhone 5c was second, ahead of the Samsung Galaxy S4. This led the Journal to change its thinking on the mid-range iPhone saying that "reduced orders could indicate weak demand, or could signal that Apple wanted to ensure adequate supply of the 5C so that potential buyers, who were more likely to be switching from competing phones, didn't have to walk out of a store empty-handed."

The Apple iPhone 5c actually sold well in September

The Apple iPhone 5c actually sold well in September


The paper even stated that Apple might have built up large inventories of its plastic coated model in order to meet demand from a rumored deal with China Mobile. That extra inventory could be for the the reason why orders placed online for the Apple iPhone 5c ship in just 24 hours.
source: AppleInsider

Related phones

iPhone 5s
  • Display 4.0" 640 x 1136 pixels
  • Camera 8 MP / 1.2 MP front
  • Processor Apple A7, Dual-core, 1300 MHz
  • Storage 64 GB
  • Battery 1570 mAh(10h 3G talk time)
iPhone 5c
  • Display 4.0" 640 x 1136 pixels
  • Camera 8 MP / 1.2 MP front
  • Processor Apple A6, Dual-core, 1300 MHz
  • Storage 32 GB
  • Battery 1507 mAh(10h 3G talk time)

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25 Comments

1. joey_sfb

Posts: 6794; Member since: Mar 29, 2012

At US$700 for an iPhone 5c 16Gb model. Apple must have been thinking that money grow on trees just like Apples.

2. androiphone20

Posts: 1654; Member since: Jul 10, 2013

You didn't even care to understand what the article meant and you just thought you could leave a comment against apple *SMH*

4. joey_sfb

Posts: 6794; Member since: Mar 29, 2012

Apple has made WSJ retract their statement so? Apple iPhone 5c still cost US$700. Apple is the one the set the expectation by using words like, no compromise option, affordable..real value. iPhone 5 2012 repackage into a plastic case and sell for US$700 is not going to generate big sales for Apple. Reducing iPhone 5c inventory and production is the reality. Yes it's does not sound hype but the reality nevertheless. Even Apple fan don't want iPhone 5c so who else would.

8. good2great

Posts: 1042; Member since: Feb 22, 2012

dude please read the article... you just came here for green thumbs. smh

25. rusticguy

Posts: 2828; Member since: Aug 11, 2012

All it meant was WSJ somehow was forced to paint a rosy picture for Apple as a follow up story ...

5. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Where are you seeing the 5Cheap listed for $700 USD for a 16Gb edition?

6. PapaSmurf

Posts: 10457; Member since: May 14, 2012

Different country = different price.

10. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Still curious where Apple thinks 'cheap' equates to a $700 USD sell price. The U.S. market is howling over a $549 price for an unlocked 5Cheap. An extra $150 would certainly depress whatever sales were occurring here, so I am wondering where the extra $150 is being charged.

13. ardent1

Posts: 2000; Member since: Apr 16, 2011

A brand new 16GB 5C goes for $450 on virginmobileusa.com Plus, if you sign up for autopay, the Beyond Talk plan starts at $30 a month.

21. joey_sfb

Posts: 6794; Member since: Mar 29, 2012

http://store.apple.com/sg/buy-iphone/iphone5c Since you ask nicely. I not sure whether you can access my local Apple store web site. That being said if you think iPhone 5c is worth it buy it and be happy with the purchase. US$1 -> 1.2 Singapore dollar

22. joey_sfb

Posts: 6794; Member since: Mar 29, 2012

iPhone 5c 16GB. $318.00 24 months Singtel contract at $50++ per month I paid $348 for Note 3 32GB with the same plan. Apple used to own more than half the market share in 2009 and 2010. That was in the past. Samsung has command the lion share since.

3. TwentyWendy

Posts: 65; Member since: Aug 12, 2013

Apple is dedenne favorite food, high resale value make dedenne afford enough to upgrade from iPhone 5 to iphone 5s... Call me i$heep all you want, but I'm not, I'm dedenne and Apple is my favourite food

7. PapaSmurf

Posts: 10457; Member since: May 14, 2012

Hi Wendy.

9. Googler

Posts: 813; Member since: Jun 10, 2013

The chart has rankings, is there a chart that shows actual values of units sold? Everyone knows the iPhone dominates the month it is released, but how many more units did it sell for the 5s compared to other handsets?

11. Droid_X_Doug

Posts: 5993; Member since: Dec 22, 2010

Apple certainly won't be a-telling. Especially if as is being reported, the 5Cheap isn't selling as well as Apple is wanting it to sell.

12. ardent1

Posts: 2000; Member since: Apr 16, 2011

I understand D_x_D is either unwilling, unable or both unwilling and unable to back into the estimated 5c sales. The sales of 5c are massive, but don't tell that to Googler who doesn't understand "run rate".

23. Sniggly

Posts: 7305; Member since: Dec 05, 2009

See, ardent, you keep insisting that 5c sales are massive while ignoring that no one here is disagreeing that it's selling. When we say that Apple didn't sell as many as they thought they would, we're referring to the fact that the difference between supply and demand is really lopsided, as there's never been an iPhone before that has consistently been completely in stock through the first month after launch. We're not equating the 5c to the Kin, ardent. We're using the evidence to conclude that sales are lower than Apple hoped, even if they are objectively selling well.

16. Googler

Posts: 813; Member since: Jun 10, 2013

Charts without figures is worthless. It's like saying Apple is second to Android in world sales, sounds great. If you know Android has 80% of world market, suddenly second place doesn't have the weight it did without the percentages. Agreed on the reports, even after the first weekend they didn't release the actual differences between the 5s and 5c. It took other agencies to interpret the reports to come up with unofficial numbers on how little the 5c is selling compared to other iPhone models. It's going to be a while longer before we get the official word that it sold less than Apple had expected, and even then there will be spin on it. Simple reality is you don't cut production a week after release if the phone is selling up to expectations.

14. ardent1

Posts: 2000; Member since: Apr 16, 2011

Loading...

17. ardent1

Posts: 2000; Member since: Apr 16, 2011

The EDIT didn't take. There are 30 days in the month of September -- 30 days to sell the S4. However, Apple launched late in the month, and despite the late launch, it had the top 2 spots at 2 carriers.

15. Finalflash

Posts: 4062; Member since: Jul 23, 2013

Who cares how many more, in the end, they accomplished what they set out to do by shafting potential iPhone 5 customers and forcing them to a higher priced iPhone 5s. This is why Apple can't be trusted and I still don't know why people haven't caught on to this BS by now. From this recent move of reducing competition in their own ecosystem to phone breaking "updates" in software. When will people understand that their entire model is built on trapping and then forcing people to do things against their own best interests.

18. tedkord

Posts: 17088; Member since: Jun 17, 2009

So the Galaxy S4 was #1 on three of the 4 carriers in August, #2 on the fourth. In September, during the iPhone launch month, it stayed at #2 or #3 on all four major carriers, but we see constant articles that it's flopping.

19. greathero1

Posts: 584; Member since: Jun 13, 2008

Right. No phone other than an iPhone comes anywhere close. I just think the expectations were too high. Im pretty sure LG, HTC, and Sony would love to be in Samsung's shoes right now.

20. ardent1

Posts: 2000; Member since: Apr 16, 2011

You need to adjust the sales for actual days sold for the month of Sept. If Apple had the same 30 days in September to push the 5S and 5C, the rankings would have been different.

24. SteveS

Posts: 51; Member since: Oct 15, 2013

Or to put it another way, Apple sold in just 3 days with the iPhone 5s launch what it took Samsung to sell in 30 days with the GS4 launch. Just imagine how many Apple could have sold if they had enough supply.

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