Shares of Apple Inc. (NASDAQ: AAPL) were trading
lower by nearly 1 percent on Friday following a concerning report from Nikkei Asian Review.
According to the publication, Apple is expected to cut back production of its iPhone devices by around 10 percent in the first quarter of 2017. Citing "data from
suppliers," the publication added that the production cut follows an already reduced output throughout the first three months of 2016
following high inventory levels of the iPhone 6s at the end of 2015.
Even though Apple cut production in 2016, sales of its iPhone devices still sold poorly.
At the same time, Apple could also be facing issues with its supply chain. The company's larger screen iPhone 7 Plus continues
to sell well, but a shortage of sensors for the camera plagued Apple's production and its ability to keep up with global
demand.
Investors paying close attention to Apple's supply chain and looking to invest in the company's suppliers should also be
cautioned that the report stated that Japanese component suppliers "will again feel pain from the coming cuts." Orders placed by
Chinese smartphone makers and technology related to autonomous driving will only "soften the blow" for the many Japanese component
makers.
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