Apple rises after report says there's an unexpected surge in iPhone 11 demand

Key Points
  • The Nikkei Asian Review reports that Apple has asked suppliers to increase production of its iPhone 11 models.
  • Shares of Apple are increasing following the report.
  • CEO Tim Cook recently says iPhone 11 sales are off to a "very strong start."
Apple CEO Tim Cook waves to customers before they enter Apple's flagship 5th Avenue store to purchase the new iPhone 11 on September 20, 2019 in New York City. Apple's new iPhone 11 goes on sale today at the grand re-opening of the 5th Avenue store.
Drew Angerer | Getty Images

Shares of Apple closed up 2.8% on Friday after the Nikkei Asian Review reported the company is increasing production of the iPhone 11 models by as much as 10%.

The surge in production is being driven by better-than-expected demand for the new handsets, Nikkei reported, citing sources close to the situation. Apple bumped up orders for the $699 iPhone 11 and the $999 iPhone 11 Pro, while the company is cutting back on orders for the iPhone 11 Pro Max, which starts at $1,099.

Suppliers said demand is strong "for now," but warned that the surge might not last, the Nikkei said.

In a note to clients on Friday, Deutsche Bank analysts said they couldn't confirm the Nikkei report, but they continue to see upside to current iPhone unit sales. The analysts said there's also a strong chance that Apple could report year-over-year growth in iPhone revenues "if the report proves to be true."

It comes as Apple CEO Tim Cook said in an interview with German newspaper Bild that iPhone 11 sales appear to be off to a "very strong start." While he didn't share any specific sales figures, Cook said he "could not be happier" with the iPhone 11 launch.

J.P. Morgan analysts also voiced optimism about sales of the new iPhones. In a note on Monday, J.P. Morgan projected Apple could sell 1 million more iPhones than it previously expected in the current quarter.

Here's what could be behind Apple's increase in iPhone production
Here's what could be behind Apple's increase in iPhone production