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According to a new report from Nikkei, via MacRumors, Apple is set to cut back iPhone production by 10% from the first quarter of 2017 due to “sluggish” global sales of the iPhone 7 and iPhone 7 Plus in particular.
While Apple was expected to capitalize on Samsung’s recall of its Galaxy Note 7 phone earlier in the year, analysts say that Apple failed to do so because the iPhone 7 line was lacking in terms of “compelling features.” Possibly Apple was aware that the phones had not sold as well as expected way back in September when it didn’t disclose the first weekend sales figures for the iPhone 7 and iPhone 7 Plus.
Apple actually experienced the same problem with sales of the iPhone 6s back at the end of 2015, but that had more to do with a backed-up stockpile of iPhone 6s inventory, hence Apple lowering output of the iPhone 6s in Q1 2015.
Source: http://www.macrumors.com/2016/12/30/apple-reduce-iphone-7-production/