IPhone 8 delay that could cost Apple billions
SPeCULATION the latest iPhone could be delayed has reached fever-pitch as Apple prepares to report its results tomorrow.
The world’s most valuable company has so far stayed silent on rumours it is facing supply chain issues, but investors are watching closely for possible clues.
Analysts warn that release of the iPhone 8 could be pushed back from September to October or later, partly because of the cutting-edge components it is likely to need. But any delay would hit annual profits, as the firm can usually rely on making billions from the sales of a new model in its fourth quarter, which ends in September.
The tech giant could also be about to report a dip in sales as gadget fans hold off from buying its existing handsets in anticipation of a newer one being revealed.
Apple has traditionally released new iPhone models in mid-September, with this year marking a decade since the first generation was launched. The prospect of a major overhaul has excited markets, leading to hopes the iPhone 8 could shore up lacklustre sales in regions such as China, where it saw a decline for the first time in 2016.
But the predicted overhaul has led to fears the California-based firm will be unable to produce the iPhone in the same numbers as previous models because the parts cannot be manufactured in as large quantities.
Apple is set to update shareholders with its third- quarter update after US markets close tomorrow. Since its shares reached a peak of $156.10 in May, they have slipped by more than 4pc as investors have fretted about whether it will be able to meet its usual September release date.
In a recent note to clients, Goldman Sachs analyst Simona Jankowski wrote: ‘[Fourth quarter] guidance has the potential to be highly volatile, depending on the exact timing of the launch. The potentially significant redesign of the new phone has given rise to concerns that shipments could be delayed to October due to supply chain bottlenecks.’
And Amit Daryanini, an analyst at Royal Bank of Canada, said: ‘The flagship device may not see initial shipments until October… [but] we think a delay will not change the demand dynamics for iPhones or undermine the positive upgrade cycle narrative.’