Skywind Securities analyst Ming-Chi Kuo believes Apple has reduced M2 Pro and M2 Max MacBook Pro orders by 20 to 30 percent compared to previous forecasts before production began. The experienced industry analyst said his latest survey of supply chain members shows that Apple has reduced its 14-inch MacBook Pro and 16-inch MacBook Pro orders for the fourth quarter. These will be new models launching in spring 2023 and are forecast to feature the new M2 processor.
In a post on Medium, Ming-Chi Kuo said that the main reasons for the reduced orders were the recession and the decline in demand for home work. Combine these aspects with the fact that this is a not-so-satisfactory processor upgrade across the board, and it’s understandable that orders are down 20 to 30 percent.
This decrease in orders is also a sign of reduced demand for Apple’s MacBook lineup as a whole. Ming-Chi Kuo is therefore lowering his overall MacBook shipment forecast for the fourth calendar quarter of 2022 by 15 to 20 percent.
In recent weeks, shipping times for existing MacBook Pro models have become stable. This is attributed to reduced demand, rather than sufficient supply. It is unclear whether he is referring to a reduction in demand relative to forecasts or whether Apple has reached what it says is a normalization of production and orders.
These declining orders could lead to an impact on miniLED and processor suppliers. Kuo concluded his report by saying that even Apple is not immune to recession or inflation and that investors can use demand for the iPhone 14 Pro as a criterion for judgment.
The full posting is as follows.
Apple very rarely cuts orders before peak season / new product volume production, meaning demand is significantly lower than expected, so MacBook shipments will likely continue to decline YoY at least through 1H23.
The economic downturn and the decline in WFH demand are the main reasons for the order cut, both of which will likely continue to have a negative impact for at least 6-9 months.
The major upgrade to the new 14-inch and 16-inch MacBook Pro models is only the adoption of new processors, and limited new selling points may also contribute to lower-than-expected demand.
The biggest selling points for MacBook Pro are Apple processors (with higher-tier ABF carriers) and Mini-LED displays, so significantly lower-than-expected demand for MacBook Pro is a structural risk for the higher-tier ABF carrier and Mini-LED industries.
4Q22 overall MacBook shipment estimates are revised down 15-20% due to new MacBook Pro cutbacks, and MacBook shipments will decline 10-15% YoY in 2022 (vs. market consensus of 5-10% YoY decline).
The shipping time for MacBook Pro standard models / customized models on Apple’s official website has significantly decreased from “4-6 weeks / 6-8 weeks” 2-3 months ago to “in-stock / within 1 week” now, mainly due to the significant decline in demand.
The ABF industry has expanded in recent years mainly to meet the optimistic expectations of Apple processors and Intel server processors. Following the slowdown of Intel server processor shipments, the potential risk of MacBook Pro/high-end Apple processor orders being cut in 4Q22 and a YoY decline in shipments in 1H23 will increase the chance of oversupply of high-end ABF capacity in 2023.
Mini-LED demand is mainly driven by Apple, and the potential risk of MacBook Pro order cut in 4Q22 and YoY decline in 1H23 shipments may significantly weaken the momentum of Mini-LED device shipments in 2023.
Although Apple’s MacBook order reduction rate is smaller than that of its competitors, it means that Apple’s demand for high-end products is still not immune to the recession/inflationary impact.
