Sharp cuts iPad screen production: report

Sharp cuts iPad screen production: report

Summary: A cut in iPad display production seems to corroborate earlier reports that demand for Apple's iPhone and iPad devices is finally waning.

TOPICS: Apple, iOS, iPad, Tablets

Now at consumers have a choice between the full-sized iPad and the petite iPad mini, a report claims that electronics manufacturer Sharp has effectively halted the manufacture of its 9.7-inch screens in order to concentrate on producing the smalller 7.9-inch displays.

Sources speaking to Reuters claim that production of the 9.7-inch displays at the Kameyama plant in central Japan has been cut back to what is being described as "minimal level to keep the line running this month," following a gradual slowdown that started at the end of 2012. The shift, it is suggested, comes as a result of Apple manages its inventory, but it is unclear if this is a seasonal shift or an overall decline in demand.

It is important to note that Sharp isn't the only supplier Apple uses for displays. LG Electronics and Samsung also supply panels to Apple. While neither company would comment officially on order levels, a source at Samsung told Reuters that there hadn't been any significant change in order levels.

This report comes close on the heels of another suggesting that Apple had slashed component orders for the iPhone by "roughly half" due to falling demand. Hints that Apple's iPhone and iPad juggernaut could be hitting a speed bump pushed the price of Apple shares below $500 this week, the first time the stock has been at this level for almost a year.

A suggestion that demand for the iPad could also be tailing off could spook investors even further.

Topics: Apple, iOS, iPad, Tablets

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  • Worst of possible outcomes

    iPad sales suppressed by inferior iPad mini. What could be worse than producing a device with an inferior screen, putting it in the hands of more people for side by side comparisons with 7" tablets that have much better screens. By the time Apple fixes the iPad mini's screen it will have unsold itself, turning off 'prestige' buyers in droves.
    • I agree

      1024-by-768 is not even 720P and they charge over 300 dollars for this? I've got a Samsung galaxy tab 2 for 280 dollars that has 720P, a real file manager, plays mkv, avi divx flac, wmv mp4's, and flash without a hitch. I know it only has the TI processor but for media, its really fast since the Jelly Bean update a few days ago. I just don't understand the draw to IOS with its lack of codec support, no file manager and the apps owning the files which drives me crazy. Talk about giving up control.. that's an understatement with IOS.
      Trent Larson
    • Sure

      Apple puts one's picture on the dartboard and curses one, one's family, and rails to the heavens regarding the cruelty of destiny when someone walks out of their store with an iPad Mini instead of an iPad. After all, the Mini is sold as a loss leader. Check that. I am mistaken, the Mini has Apple's famous nice margin.

      Now regarding the above article, I'm confused. I thought the rumors earlier this week were about declining iPhone 5 demand, not iPhones and iPads. I could be mistaken.

      Plus, we have three conflicting hypotheses. Demand is down, meaning negative sales growth. Sharp could be producing Mini screens and re-allocating production lines to that product (which kind of suggests that iPad demand is on track with Apple's production expansions and the Mini is taking off). This is inventory control, which also could mean a slowdown in retail sales. Or not. It could also mean that Calendar 2nd Quarter, without benefit of Christmas in one part of the world and the Lunar New Year in another, is a lower quarter that its two predecessors, but year over year growth is still occurring.

      We also know that Sharp is in financial troubles, so that makes the tea leaf reading even more complicated. It was telling that Apple orders with Samsung were not changing.

      What about rumors that Apple is going to a six-month product cycle? If true, that would mean the next announcements are in March or April. Lines could be shut down for prepping the new versions and the rumor is a bit of misdirection.
    • Mini Sales

      @jnffarrell : The iPad Mini may or may not be "inferior," but it's been a runaway success by almost any definition, possibly at the expense of iPad Retina sales, although analysts are still estimating that Apple will sell 100 million iPads in 2013, half Mini, 40% iPad Retina, and 10% iPad 2. And, following their usual planned obsolescence policy, it's a safe bet that an iPad Mini Retina will be released sometime this year.

      I'm not an Apple fanboi, as I have a Nexus 7, and am very pleased with it — especially the ability of Android 4.2.1 to support multiple accounts on one device, which has been implemented very cleanly.
      • Re: but it's been a runaway success by almost any definition

        How about based on actual sales? Normally when Apple products are successful, they are very quick to be introduced worldwide. But here in NZ, I have yet to see the Ipad Mini for sale anywhere in the shops. That suggests it's not selling very well.
  • It will all 'cutting' for Apple from now.

    Apple has peaked and they have failed to innovate anything since 2007. With Surface and Win 8/ RT which are miles ahead of iOS devices, iPads and Mac OS computers will see dramatic decline in 2013. Also there is tough competition from Kindle and Android 7 inchers squeezing iPAD mini.

    With WP8 firing on all cylinders and BB10 back in business, iPhone will decline. The only thing apple could claim is about the app count, but that is changing as well... WP8 store is growing amazingly fast this year and it has almost reached critical mass.

    Android will self destruct because of Google greed/privacy issues and malware problem. Samsung will move away from android eventually.
    • Now that's funny...

      WP8 is going nowhere. Windows 8 is killing PC sales and the tablets aren't going anywhere. Sorry but Apple lost this fight to Google a long time ago. Microsoft was never in it and probably never will be.
      • I agree

        Except for the part of Windows 8... but in tablets for sure.
        And Windows 8 will sell less than others previous I suspect, but it will be huge.... like it will be Apple and android.
        I agree Apple is reaching the limits, and it's amazing, knowing it's just one company, a closed platform and they don't even offer many variety - so kudos to them even if they stop at 15 to 20% market share.
        I was expecting that Apple was not able to sell a lot more in the last holiday season from 2012, but it seems I was wrong.... or maybe just a little bit ahead of time... again kudos to them.
        I really don't want to offend Owlll1net, but I've noticed that his/her (I'm almost sure it's a he) are completely void of reasoning and i guess most of the times it's just pointless to comment about it.
        Allow me a bit of humor - how many cylinders are those of RT? 1 with a clogged intake? :)
        • correction

          I meant Apples sales from 2011 to 2012 holiday seasons
        • You should ask CloggedBottom7. :-)

          I am not an expert about clogged items, but CloggedBottom7 could help you... :-)
  • Why not wait until Apple reports earnings before blowing smoke?

    Let’s everybody jump in now with withering rhetoric, all the while blowing smoke out our henies because NONE of us actually know.

    I suppose to some degree Apple deserves the rabid speculation because they are so secretive but come on. The most likely explanation is that demand for the mini has caused Apple to ask Sharp to increase production and they have allocated more resources to this and less to the larger screens (which several other companies also make)

    Why read anything more than that into it?

    And can't we just wait a few more days until Apple makes their quarterly report and we have some facts?

    I predict Apple will say they sold millions and millions of their shiny toys and made a gigantic profit. This may or may not satisfy their fickle shareholders but for certain will not stop the smoke blowers.

    • You seem to forget that this is in fact the ZDNet forum

      Some of the most active participants here are expected to be "fanbois", calling people with different opinions for "morons" etc. Apple fanbois are no better than Microsoft fanbois, or vice versa.

      Some participants, however, have rational and objective thoughts and are not just "defending their hive" all the time.
    • Re: Why not wait until Apple reports earnings before blowing smoke?

      Because by then it'll be too late to sell your Apple shares.
  • not quite

    I wouldn't say 'firing on all cylinders'. Its like they got the engine running but sputtering on 1 cyclinder and spewing black smoke - it will stall as that can't run like that forever. Once BB10 comes out, the engine will sieze for good.
  • True journalism is dead

    A story about a football player with a dying girlfriend gets picked up off the wires and repeated by 'reporters' who didn't use one ounce of their brains to question the story.

    This passes for journalism now, cutting and pasting previously written words without adding any insight or thought provoking words of your own.

    Just like the 'iHone 5 sales have tanked' story first posted on Reuters, which reads like a Samsung advertisement, we all have to realize that technology companies have billions at stake; PR firms are paid millions to spread FUD. Stockbrockers will do it to make a good stock sink so they can load up on it then turn a profit.

    We have no idea why orders for one size screen went down, could it be that Apple...

    -is switching to a different sized screen?
    -a different manufacturer?
    -was there a problem with yields that has been fixed?

    When Apple announces their report on the 23rd we'll have a very good idea where Apple stands.

    A little history: in the early '90's, it was predicted by many pundits that Apple was going out of business, being purchased by Sun, etc. , and no matter what happened; Jobs coming back, intro of the iMac, iPod, you still had people praying for their demise. 20 years later, the posters on these boards, because of their hatred for Apple and their love of Microsoft (I know, it makes no sense, MS is the convicted monopolist with the lowest morals and ethics of any US company; as proven by their own emails and testimony), they jump on any report, fake or not, that they think proves their 20 year old prayers will be fulfilled.

    Apples not going anywhere in the short term, sorry naysayers.

    All companies will die someday, so if Apple goes down 30 years from now, the naysayers will say "Told you!"
    • My reply

      A little history: in the early '90's, it was predicted by many pundits that THIS was the year Microsoft died, and no matter what happened; MS coming back, intro of the Xbox, Windows 7, you still had people praying for their demise. 20 years later, the posters on these boards, because of their hatred for Microsoft and their love of Apple (I know, it makes no sense, Apple is the convicted ebook price fixer with the lowest morals and ethics of any US company; as proven by their own emails and testimony), they jump on any report, fake or not, that they think proves their 20 year old prayers will be fulfilled.

      Microsoft is not going anywhere in the short term, sorry naysayers.

      All companies will die someday, so if Microsoft goes down 30 years from now, the naysayers will say "Told you!"
      • "True journalism is dead "

        oh and microsoft helped jobs revive apple by direct investment and office support ...
    • I don't quite get the trolls

      I guess I get some of the hatred of Apple, I do find myself annoyed at times that they keep things so closed . . . although there are ways around everything. What I don't get is the blind hatred. Any objective person who has used their hardware knows that it is very well made, way better made than almost everything else out there. Yeah I get that other companies may have a faster processor and include the latest technology but most of the time the latest and greatest doesn't actually work very well yet.

      Anyway, I certainly agree that Microsoft is the biggest bully in the playground. I HATE that they feel compelled to keep moving the commands around randomly with each new version of their software. Other than that complaint I've found mst of their software to work fairly decently, albeit with a few quirks and other dumb DNA
  • Inevitable decline

    Anyone with common sense knows the good ride can't last forever. Stock quality of Company or their products. Speculation plays a huge part in price. The stock is probably close to what it should be.
  • Sharp cuts iPad screen production: report

    Not surprising considering the whole tablet movement was a fad to begin with. Lets see how long Apple will keep this form factor on life support.