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Hon Hai reported a 19 percent sales decline for Q1 2013 compared to Q1 2012

Hon Hai Precision Industry Co. saw an unexpected yearly decline in the first quarter of 2013 thanks to shrinking demand for Apple's iPhone. Hon Hai reported a 19 percent sales decline for Q1 2013 compared to Q1 2012. While analysts were expecting quarterly decline from Q4 2012, they didn't see the yearly decline coming.

Hon Hai posted sales earnings of T$808.87 billion ($26.96 billion USD) for the quarter ended March 2013. This was a drop from T$988.34 billion in Q4 2012 and a further decline from T$1 trillion in Q1 2012. 

Hon Hai, which collects about 60 to 70 percent of its revenue from the iPhone and iPad, saw a decrease in sales due to low demand for the iPhone in particular. 

Apple has hard a hard time keeping up the momentum of its products, and it shows in the company's shares. Shares have fallen from $702.10 in September to $426.98 as of today. Also, Apple's iPhone only represented about 19 percent of worldwide smartphone shipments in 2012 while all Android-powered smartphones accounted for about 70 percent.

Android will even beat Apple in the tablet sector this year, according to a new report from IDC. IPad shipments are expected to make up 46 percent of the tablet market for 2013, down from 51 percent in 2012. Android-powered tablets are expected to increase their market share to 49 percent in 2013, up from 42 percent in 2012.

Samsung is a particularly strong competitor to Apple as far as Android-powered devices go. We even saw a bit of fear in Apple as Phil Schiller (Apple's senior vice president of worldwide marketing) talked trash about Android on the eve of the Samsung Galaxy S IV release. 

Samsung is even racing Apple to make a wearable device this year -- much like a smart watch -- and has plans to trump Apple's new spaceship campus with a more impressive headquarters in the U.S.

Source: Reuters



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RE: Hon hai who cares
By Shadowself on 4/10/2013 11:48:19 AM , Rating: 2
quote:
Tim Cook is an excellent supply chain manager.
I've heard this mantra so many times it makes me sick to hear it yet again.

If Tim Cook were such an excellent supply chain manager why were there widespread shortages for the iPhone 5 for over two months and shortages in some venues for almost four months? The iPhone 5 shipment wait times did not get under three days worldwide until late January 2013.

If Tim Cook were such an excellent supply chain manager why did Apple announce new iMacs that you couldn't even pre-order any models for over a month and could not pre-order certain models for over two months? For those you could pre-order the wait times were up to six weeks in some cases for a month or more and up to four weeks as much as three months after pre-orders started.

If Tim Cook were such an excellent supply chain manager why did Apple announce new MacBooks that had wait time of up to four weeks for over a month in some regions?

Tim Cook might have been a great supply chain manager when he worked for Jobs, but now that Tim Cook is the CEO the supply chain seems to have gone to hell.


RE: Hon hai who cares
By Tony Swash on 4/10/13, Rating: -1
RE: Hon hai who cares
By retrospooty on 4/10/2013 3:54:14 PM , Rating: 1
I have to agree with you and Gartner there... Say what you want about Apple, their supply chain management isnt "good" it isnt even "great" its absolutely amazing. Having spent several years in the excruciatingly boring supply chain side of things, I can tell you... That many devices with that many parts from that many vendors, especially the notoriously difficult to manage Chinese vendors is a monumental task. Apple makes it look easy.


RE: Hon hai who cares
By karlostomy on 4/11/2013 8:02:45 AM , Rating: 2
Kudos must go to Apple for their ongoing excellence in supply chain management.

Now all they have to do is start innovating again.

Most reasonable people would agree they have ceased to innovate and are just selling the same old vanilla ios and hardware, with some token upgrades, in the same way they have done for a long time.

And why not, consumers seem to be caught in a fad loop and apple is cashing in on that.
Nothing wrong with that, as long as we recognise it for what it really is.

Apple is cashing in on the consumer fad in the same way the Bieber is cashing in on bubblegum pop teenie culture.

Sure, Bieber is making buckets of cash, but is he creating good music?
In the same way, apple is making buckets of cash, but are they innovating?
Something to think about.

But yeah, I agree, Apple has a fabulous supply chain.
Come to think of it, doesn't the Bieber also have a fabulous supply chain for Bieber merchandise?
http://www.washingtonpost.com/wp-dyn/content/artic...

Lots to think about.


RE: Hon hai who cares
By retrospooty on 4/11/2013 8:40:48 AM , Rating: 2
"Most reasonable people would agree they have ceased to innovate and are just selling the same old vanilla ios and hardware, with some token upgrades, in the same way they have done for a long time. And why not, consumers seem to be caught in a fad loop and apple is cashing in on that.
Nothing wrong with that, as long as we recognise it for what it really is."


Agreed, and well said. Any reasonable person would agree. Any reasonable business minded person would also cash in on it. Apple, as a business is uber-powerful.

"Apple is cashing in on the consumer fad in the same way the Bieber is cashing in on bubblegum pop teenie culture. Sure, Bieber is making buckets of cash, but is he creating good music? In the same way, apple is making buckets of cash, but are they innovating? Something to think about."

Exactly. But I think we are seeing the tide changing, and Apple sees it too. Rumors of several changes are all over the place. Cheaper low end models, a larger screen model, OS7 FINALLY updating the UI etc. And that is all good. If Apple ups it just a bit, it keeps the competition from stagnating. I personally think a 5 inch screened iPhone would sell insane amounts and make huge profits, and so would a cheaper low end model.


RE: Hon hai who cares
By BRB29 on 4/10/2013 2:39:09 PM , Rating: 2
There are widespread shortages for every highly anticipated product. It just meant there are more demand than supply. For an extremely widespread high demand product like the iphone, there's no chance that there's enough of it at launch for several reasons.

1. They would launch earlier if they had that much inventory stocked
2. They can't take the chance of having a surplus. A shortage is better as there is no chance of losing money.
3. The high demand and low supply at launch guarantees their price and gives the impression of a "superior" product everyone wants.
4. The shortage itself is like free advertisements and creates more demand
5. They don't want all the hype just to have their products sit on shelves and kill its own image.
6. They can efficiently adjust production and channel inventory correctly since they know where the shortages are.

The job of a supply chain manager is efficiency. Having a surplus, especially in electronics, will hit the bottom line hard and fast.

His problem is that he is still working the supply chain instead of directing like a CEO. Where are the new products we're supposed to see. I get the feeling we're going to see a whole lot of the same thing.


RE: Hon hai who cares
By TakinYourPoints on 4/10/2013 8:14:00 PM , Rating: 2
The iMac gaffe is a huge thing. A whole month where they didn't have any new iMacs because of manufacturing issues on new models, bad. Supply constraints on iPhones and iPads are one thing, those sell as quickly as they can be made, but at least they were being made.


"If you can find a PS3 anywhere in North America that's been on shelves for more than five minutes, I'll give you 1,200 bucks for it." -- SCEA President Jack Tretton














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