New evidence iPhone 8 faces 'worst case' shortage scenario, KGI says

Key Points
  • KGI says Apple's iPhone 8 is facing huge barriers that will cause shortages.
  • The firm is revising 2H17 iPhone shipments down to 80M - 90M units from 100M - 110M units
  • Several new components to blame for problems
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The iPhone 8 may face huge shortages as production problems continue to crop up, according to an Apple analyst with a historical record of accurate predictions.

KGI Securities analyst Ming-Chi Kuo said on Tuesday that Apple is facing a "worst case scenario" wherein Apple might not be able to build as many units as originally expected, thanks to problems with new components. The note was obtained by 9to5Mac.

"We are seeing more evidence that the worst-case scenario forecasted in our April 19 report could materialize, where new iPhone shipments in 2H17F are revised down to 80-90mn units from 100-110mn units (vs. consensus of 100-120mn units)," Kuo said. The analyst has previously suggested that Apple's iPhone 8 will be delayed to October or November due to issues related to merging new OLED panels with the fingerprint reader.

Kuo is particularly concerned with "whether the 3D sensor of the OLED iPhone provides an innovate user experience; whether OLED iPhone cancels Touch ID (fingerprint recognition); and whether Apple's competitors launch more innovative products which could compete with OLED iPhone."

Kuo isn't alone in his fears that the iPhone 8 won't make it to market in September, when Apple normally releases its new iPhones.

Drexel Hamilton said in April that new 3D components and a new OLED display will cause the iPhone 8 to be delayed by "several weeks." Likewise, Cowen and Company said earlier this month that the iPhone 8 is facing a 4-6 week delay.

Keep in mind that while these reports are certainly bearish on the iPhone 8, Apple is still expected to announce two other devices, the iPhone 7s and iPhone 7s Plus, which may still launch in September.

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