The alleged cuts of iPhone 5 component orders are due to an upcoming 'evolutionary technology update' for the iPhone 6, not a lack of demand for Apple's smartphone, an analyst has suggested.
Global Equities Research's Trip Chowdhry believes that Apple has begun sourcing its screens from a new supplier in preparation for the launch of the next iPhone, which is why it seems as though Apple is cutting back on order for iPhone parts.
Earlier this week, the Wall Street Journal published a story claiming that Apple has halved its component orders for the iPhone 5 due to low demand for the device, leading Apple's share price to fall below $500 per share. However, the report's accuracy was later questioned, and was accused of being 'flawed'. Some suggested that there may have been some stock manipulation involved in the report.
But Chowdhry claims: "The data is accurate, cancellations are happening - but what is the underlying reason? There is a technology shift happening at Apple."
He thinks that the share sell-off was overblown, and that Apple is in fact preparing to launch an "evolutionary leap in phones" and possibly a new TV venture within the next three quarters. He expects Apple to introduce IGZO screens into its next iPhone, which will be lighter, more energy-efficient, and easier to cut for different sized models.
Apple is rumoured to be planning to launch an iPhone mini this year, a low-cost, smaller iPhone that could be made with plastic to make the device cheaper. SEE: Apple's low-cost iPhone mini could look like this
Chowdry also notes that IGZO glass could be used to create flexible phones, representing the next leap in handheld technology. Samsung has already shown off its foldable, rollable 'Youm' smartphone displays this month, indicating that the technology could be making its way into devices in the near future.
According to Chowdry, Apple has been ordering glass that is also able to be cut into large panels, which could indicate that the company is working on its widely speculated Apple television set.
Chowdry believes that 2013 is the year of innovation for Apple, and that if his predictions are correct, Apple's share prices will rise to $650.