Apple reduces iPhone 16 production by 10 million

It appears that Apple is struggling to meet the expected demand for the iPhone 16 series. According to Apple analyst Ming-Chi Kuo, the company has cut iPhone 16 production by 10 million units.

As Apple reduced iPhone 16 production by 10 million units, the company’s shares dropped by nearly 2% on Wednesday. The renowned supply chain analyst Ming-Chi Kuo noted that this reduction primarily affects the fourth quarter of 2024 and the first half of 2025.

According to Kuo's report, the cuts primarily impact the standard iPhone 16 models, while the iPhone 16 Pro models continue to attract more interest due to their advanced displays and cameras.

iPhone 16 order reduction

"As a result, production estimates for iPhone 16 in the second half of 2024 have dropped to 84 million units," Kuohighlighted, noting that previous forecasts were around 88 million. The analyst estimates that Apple's partners will produce 80 million iPhones in the last quarter of this year, a decline from last year’s 84 million for the same period. Additionally, he projects that 45 million units will be produced in Q1 and 39 million in Q2 of 2025, compared to last year's 48 million and 41 million, respectively.

Kuo also mentioned that iPhone revenues are likely to face pressure in the first half of 2025 due to lower annual shipments and a less favorable product mix. The iPhone SE 4, expected to be released in December, may also contribute to this trend.

Kuo addressed Apple's potential in artificial intelligence, stating, "I believe Apple holds the leading position in on-device AI, and in the long term, Apple Intelligence will likely become a popular paid service." Apple Intelligence is expected to be available in beta next week with the iOS 18.1 update. This new feature will be supported by the iPhone 16 and the previous year’s iPhone 15 Pro models.