Talk of production cuts for iPhone SE 3 and AirPods 3 not confirmed by supply chain says report

The latest word on the new iPhone SE 3 is that initial sales of the device have been less than expected. Despite powering the phone with the same A15 Bionic chipset found in the iPhone 13 series and adding 5G connectivity to it, Apple has reportedly cut orders by as many as 20 million units. Unfortunately for Apple, the iPhone SE 3 isn't the only device that has started to choke at the cash register.

Reliable TF International analyst and now Twitter tipster Ming-Chi Kuo has said that "significantly lower" demand for the AirPods 3 has forced Apple to cut orders by 30%. However, Digitimes (via AppleInsider) was advised by Taiwan-based suppliers that they have yet to receive orders from their customers ordering them to reduce the production of their components.

Kuo has sharply dropped his forecast of iPhone SE 3 shipments from a range of 25 million-30 million to a range of 15 million-20 million units. Apple did feel the need to hike the price of the latest iPhone SE 3 model by 7.5% most likely due to the expensive components needed to allow the handset to offer 5G connectivity. The iPhone SE 3 starts at $429 compared to a starting price of $399 for the previous model.

On the other hand, the flagship iPhone 13 line is said to be doing quite well although the iPhone SE 3's weakness mirrors the soft demand Apple has been experiencing for the iPhone 13 mini. There are expectations that the mini is exiting the iPhone lineup starting with this year's iPhone 14 series. It seems that iPhone users aren't as excited about a smaller-screened iPhone regardless of whether it looks up to date like the mini, or sports a retro design like the SE.

As for the AirPods, Kuo says that customers believe that there is not enough new features in the AirPods 3 to warrant a $50 difference between that model and the AirPods 2. The latter is priced at $129 while the former can be had for $179 although both can be found for less.

There are some differences between the two models such as the surround sound experience that Apple delivers to the AirPods 3 with its spatial audio. The newer model also features an IPX4 IP rating for protection from sweat and splashes. Additionally, the battery life on the AirPods 3 delivers as much as 30 hours of listening time using the carrying case compared to 24 hours with the AirPods 2.

Apple, according to Kuo, is now looking to drop the OG AirPods Pro when it releases the AirPods Pro 2 to avoid this cannibalization from occurring again.

It should be noted that just because suppliers say that they have not yet received orders to cut production, such orders could still be on the way. A well-connected analyst like Kuo could have heard in advance about Apple's production plans before the company informs the actual suppliers.