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Only Apple Knows For Sure Whether The iPhone 5 Is In Trouble

We’re living in a 24/7 world where rumors and analysis often meet in a way that causes confusion. The strength (or weakness) of the iPhone 5 in the marketplace is an excellent example of this, as this week has already proved. Within the past few days, we’ve heard conflicting stories about the financial health of Apple’s flagship product. One report, which AppAdvice highlighted earlier this week, suggests that the company has cut their iPhone supply orders by as much as 50 percent due to weakening demand. The result was a drag on Apple’s already plummeting stock price. A newer report, this one from AppleInsider, suggests that the opposite is true. Analyst Shaw Wu with Sterne Agee says that his “checks with suppliers” suggest that iPhone 5 demand “remains robust.” About those possible supply cuts, Wu says that this has a lot to do with improved yields, which has required Apple to place fewer orders for components. Much of the uncertainty is largely due to Apple, and I don’t necessarily mean that in a negative way. The world is waiting for Apple to announce their holiday sales numbers on Jan. 23. Until that happens, no one can say with 100 percent certainty whether iPhone sales are growing or weakening. As a result, analysts such as Wu are forced to base future iPhone sales projections on undefined source checks, rumors, and innuendoes. Also at play is Apple’s own secrecy as it relates to offering up sales numbers and projections. Since they last released financials in October, Apple has mentioned iPhone sales only once in a press release. This had to do with sales of the handset in China during its first weekend of release in the world’s largest consumer market. That release, which said that iPhone 5 sales in China topped “over two million,” came before the end of the holiday quarter, and obviously, mentioned nothing of iPhone sales elsewhere in the world. So what’s the big deal? Apple is the largest technology company in the world. In fact, before the company’s stock started to slide in September, Cupertino had the distinction of being the largest company in the world. In other words, when Apple develops a cold, it affects more than just stockholders. A poor showing next week by Apple, in fact, could suggest that some economies are once again heading into a recession. Until Jan. 23, expect to hear more about Apple, and the iPhone 5. Whether what you are hearing is factual remains anyone's guess.
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