Late Sunday night, the Wall Street Journal reported that Apple is cutting iPhone parts orders in half due to weaker than expected demand.Then The Nikkei reported that Apple asked LCD panel partners to cut orders for iPhone screens in half from 65 million during the March quarter.
Yesterday, Apple stock tanked on the news, briefly trading below $500.
Now, Apple bloggers all over are questioning whether the WSJ and The Nikkei are getting played by people trying to manipulate Apple’s stock ahead of its earnings call next week.
It started with a report in BGR by Tero Kuittinen, arguing that the numbers in the WSJ report and The Nikkei are “weird.”
The latest estimates for iPhone sales during the Christmas quarter average around 52 million units. Let’s assume (charitably) the iPhone 5 portion of this may be anything from 30 to 40 million. In the seasonally soft March quarter, iPhone 5 unit sales might be 25 to 35 million units. Sales of the latest iPod touch tend to drop by 50% from the Christmas quarter to the March quarter, but could add 4 million units to the total number of devices equipped with 4-inch Retina displays Apple sells in the quarter.
So if the most likely number of 4-inch screens Apple is reasonably expected to sell in March quarter is around 30 to 40 million units, why did Nikkei publish a report stating that Apple had halved its display orders for the quarter from 65 million units? Nikkei was quite specific about the 65 million number. And it clearly tied it to iPhone 5 component orders, not total iPhone or iPhone 5 and iPod touch orders.
In what world did Apple expect to order components for 65 million iPhone 5 handsets in the seasonally soft March quarter?
Perhaps the weirdness of the maths is why the current version of the WSJ article no longer cites the 65 million unit figure. Sometime between Sunday at 8:00 p.m. EST and Monday at 7:00 a.m., the Journal decided to drop the number from its article. But if the 65 million number is not right, is the estimate for halving March orders correct?
TechCrunch columnist/VC MG Siegler writes:
A few things going on here: 1) WSJ cites an analyst numbers then removes the reference 2) Apple not responding (because they can’t: loopinsight.com) 3) Possible stock manipulation ahead of earnings
The Next Web’s Matthew Panzarino goes a step further, writing:
Let me get this straight 1. Analysts make up 65M iPhone number. 2. Analysts then say make believe number ‘cut in half’ 3. Stock manipulation
The reports claiming 65 million displays for next quarter make little sense; the reports that claim component orders have been “halved” but without any specific numbers can’t be verified three months from now when Apple reports its actual iPhone sales for the coming quarter. In the meantime, of course, Apple’s stock took a beating today on these reports. If you don’t smell stock manipulation here, I have a bridge to sell you.