The story of December for Apple was the monster drop in its stock price.One of the main reasons the stock tanked was numerous reports from sell-side analysts about Apple severely cutting its iPhone 5 orders for the first quarter of 2013.
The initial read on this cut was that demand for the iPhone 5 was weak. Otherwise, why cut the orders?
But it looks like there might be an alternative explanation for the cuts.
First, Apple’s manufacturing of the iPhone could have been better than expected.
Second, and much more importantly, Apple is apparently going to release a new iPhone in the May-June time frame, according to Topeka Capital analyst Brian White. His report is seconded by Peter Misek at Jefferies. (Misek has a June-July timeframe, White has May-June.)
Most analysts have been assuming Apple will sell the next iPhone in September or October since that’s what it did for the iPhone 4S and the iPhone 5.
But, if Apple is really shifting the release of the next iPhone 5, then it’s likely that it’s going to change production of the iPhone 5, cutting back its orders for the first quarter of the year. It won’t want a big build of iPhones. It has also seen demand for iPhones drop as the rumour mill starts cranking about the next iPhone.
Two quarters before the iPhone 5 was announced, iPhone sales were worse than expected. Apple blamed the dip on rumours about the next iPhone. If a new iPhone is coming in June, then it might be anticipating a drop in the March quarter.
We’re not sure if that makes investors feel much better, since it suggests it’s going to miss numbers for the first quarter of this year. But, it’s certainly better than weak iPhone 5 demand, which would be a problem with Apple’s core business.
Apple reports earnings on January 23, so we’ll find out the truth about iPhone demand during the holidays, as well as getting an idea about demand for this quarter through Apple’s guidance.