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Apple Tells Suppliers iPhone Demand Has Slowed

Apple is suffering from a global supply crunch, is now confronting a different problem: slowing demand. The company has told its component suppliers that demand for the iPhone 13 lineup has weakened, people familiar with the matter said, signaling that some consumers have decided against trying to get the hard-to-find item.

Apple had cut its iPhone 13 production goal for this year by as many as 10 million units, down from a target of 90 million, because of a lack of parts. The company is now informing its vendors that those orders may not materialize, according to the people, who asked not to be identified because the discussions are private.The current lineup, which starts at $799 for the standard model and $999 for the Pro, is considered a modest update from the iPhone 12, which had a whole new design. Bigger changes are expected for the 2022 model, giving some shoppers a reason to wait.Apple, based in Cupertino, California, declined to comment.

Apple shares fell as much as 4.2% in trading in New York on Thursday, while suppliers across Asia and Europe extended their declines after Bloomberg’s report. In South Korea, LG Innotek Co. slid 8.4%, while Japan’s TDK Corp. dropped 3.6%. In Europe, STMicroelectronics NV slipped 3.9% and Infineon Technologies AG declined 3.1%.

Apple main iPhone assembler, Hon Hai Precision Industry Co., predicted that its business will shrink this quarter from a year earlier caused by declines in consumer electronics and computing as it continues to suffer from the chip shortage. On Oct. 24, IQE Plc saw its shares fall 24% after it warned of softening smartphone demand, although the semiconductor company didn’t name any particular customer.

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