Analysts dubious about iPad supply issues
Analysts have expressed their doubts over claims from a J.P. Morgan report that Apple cut its iPad orders from certain suppliers by 25 percent over the fourth quarter.
Following claims from a J.P. Morgan analyst that Apple cut the number of iPads it plans to order from suppliers, other analysts have chimed in to disagree.
J.P. Morgan analyst Gokul Hariharan yesterday issued an investor note saying Apple would slash its iPad orders by 25 percent for the fourth quarter, a move that would affect such suppliers as Hon Hai Precision. The report triggered a Bloomberg report and prompted speculation that Apple may be seeing weaker demand for the tablet in Europe or just trying to work with less inventory.
The analyst's claims also took a bite out of Apple's stock in early trading yesterday.
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But Hariharan isn't finding much consensus among other analysts.
Piper Jaffray's Apple analyst, Gene Munster, disputed the "chatter of supply chain order reductions," saying that following a trip to Asia, he's sticking with his estimate of iPad shipments for the third and fourth quarters of 10 million and 12 million, respectively.
"We also note that previous calls based on sell-in or supply chain data have, for the most part, proven to have very little correlation with Apple's results vs. consensus dating back to early iPod shipments," Munster added in a note released yesterday. "We believe Apple purposely maintains enough suppliers and manufacturing partners to make any one supply-side data point inconclusive. For example, Apple is currently transitioning to Brazilian iPad manufacturing, which may be impacting Asian manufacturing numbers."
Susquehanna analyst Chris Caso also took issue with claims of supply chain problems, according to an All Things Digital report, calling the matter a change in the production schedule of the iPad rather than any type of cut.
Finally, J.P. Morgan's Mark Moskowitz weighed in on the alert issued by his fellow analyst, saying Hariharan's report is "not the view of the U.S. IT hardware team." Instead, the team sees build plans and shipment levels for both the iPad and iPhone continuing to rise. Hearing a lot of "supply chain noise" over Apple products during the past several months, Moskowitz noted that Apple's operating results and shipments are still managing to surpass expectations.
Various adjustments to the supply chain do occur often, acknowledged Moskowitz, but any issues would impact the suppliers more so than Apple.