Apple has reportedly cut the order for iPhone 5 LCD panel over weak demand. However, Sterne Agee analyst Shaw Wu says higher efficiency was the reason behind this reduction in LCD screens for iPhone 5.
Wu said in a research note that demand for Apple iPhone 5 remains robust in the market. He says the reason behind the cut in order is due to "(1) much improved yields meaning lower component builds and (2) supplier shifts." This means that Apple placed an order of screens for iPhone 5 keeping in mind low yields, but recently revised that figure taking into account the increase in number of ready-to-ship units.
This would mean that the number of screens being manufactured for iPhone 5 has indeed been reduced, but this has no bearing on the demand for the smartphone in the market.
Coming to the second possible factor, a change in supplier would also mean that one of the suppliers of iPhone 5 display panel leaked that the order has been cut, without an actual decrease in demand for the device.
Earlier this week, Wall Street Journal reported that Apple has reduced the order for LCD screens for iPhone 5 owing to a decrease in demand for the phone. It said that Apple has cut the initial order of 65 million display units for iPhone (for Q1 2013) by 50%. This led to a decline in stocks of Apple as well as its display suppliers like Sharp.
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