iPhone 8 To Enter Mass Production Earlier Than Usual: Analyst

iPhone 8 To Enter Mass Production Earlier Than Usual: Analyst
Image Source: Thadeu Brandão / ConceptsiPhone (YouTube video)

The hype around Apple’s iPhone 8 continues to intensify even though its launch is still several months away. Some analysts expect it to shatter all the previous sales records. Apple is also anticipating strong demand for its 10th anniversary iPhone. BlueFin Research Partners analysts John Donovan and Steve Mullane said in a research note that the Cupertino company has already started cutting production of the iPhone 7, 7 Plus and iPhone SE as it prepares for the iPhone 8 launch.

iPhone 8 to launch in September

Citing supply chain sources, the analysts said the iPhone 8 production would begin earlier than usual. BlueFin Research Partners claims that Apple would ramp up production in the June quarter. Despite an early production schedule, there is no indication that the handset would launch before September. It indicates that Apple plans to build up inventory to meet massive consumer demand upon release.

The analysts also referred to the upcoming smartphone as iPhone X. There have been speculations that the 10th anniversary iPhone could be called iPhone X rather than iPhone 8. Apple is also said to launch two other smartphones, iPhone 7S and 7S Plus, that will be minor upgrades over the current flagship models.

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Apple building up inventory

An earlier production timeline would give the iPhone maker sufficient time to fix manufacturing issues and improve the yield rates, and better manage the supply chain in the run-up to September unveiling. The iPhone 8 is rumored to sport an edge-to-edge OLED display, wireless charging, a glass-sandwich design, IP68 waterproofing, and no physical home button.

Bernstein analyst Toni Sacconaghi Jr. told investors that the iPhone’s installed base had grown rapidly in the last few years. The research firm estimates that the iPhone 8 cycle will have an installed base that is 80% larger than the iPhone 6 cycle in 2014. By 2018, as many as 203 million iPhones will get old enough that their owners would buy a new one. Apple’s existing customer base, coupled with the new buyers it attracts every year, would ensure a stellar performance for the iPhone 8.

There is no such thing as iPhone 8 supercycle, claims analyst

Not everyone is bullish on the upcoming iPhone. In an interaction with Steven Milunovich of UBS Securities, Apple analyst Neil Cybart said the iPhone 8 supercycle was unlikely to happen. Cybart believes that a large portion of the installed base won’t jump to buy the new iPhone. He argues that users would upgrade as and when they need to, and many of them would wait for later releases.

Along the lines of Neil Cybart, Barclays analyst Mark Moskowitz told investors last month that the iPhone 8/X was overhyped. The device won’t be able to overcome challenges that Apple is facing. The gap between the iPhone and its Android rivals has narrowed significantly. Most of the rumored iPhone 8 features are already available on Android phones. On top of that, Apple is facing stiff competition from Android vendors in China.

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