As the holiday shopping season officially begins, KGI’s Ming-Chi Kuo is out with a new investor note this morning touching on iPhone X demand and supply. Kuo explains in the note that while some believe the iPhone X’s quickly improving supply is due to low demand, he attributes it to production improvements with demand remaining strong…

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The analyst says that Hon Hai’s shipments of iPhone X units have climbed to 440,000 to 550,000 units per day. That’s up dramatically from the 50,000 to 100,000 being shipped per day just 1-2 months ago.

Suppliers are also ramping up production, with Career’s LTE antenna seeing 100 percent month-on-month growth and the Dot projection module from Sharp and LG hitting 80-90 percent production yield.

Kuo said last month that supply of key Face ID components was “stable” and today’s note seems to further echo that sentiment.

KGI was one of the first analysts to slash iPhone X order expectations due to supply concerns earlier this year, but he’s now saying that Q4 2017 shipments could be “10-20 percent higher than previously estimated.” The improved supply and production process means some orders that would have originally be fulfilled in Q1 2018 will now be filled in Q4 2017, he says.

Because of this, Kuo expects “flat/slightly lower” iPhone X shipments in Q1 2018 compared to Q4 2017. This, of course, should be expected as Q4 marks the big holiday shopping period for many customers.

Ultimately, Kuo says he is “positive on demand for iPhone X” and doesn’t agree with views that say demand for the device is weak.

In our view, Apple wants consumers to receive their iPhone X as soon as possible. With production capacity rising substantially, it is only natural that buyers are seeing a shorter shipping time.

Supply of the iPhone X has been improving rapidly since its release earlier this month. If you order from Apple’s Online Store, you’ll now receive your device within 1-2 weeks, down from 5-6 weeks immediately after pre-orders began. Furthermore, Apple Stores around the country continue to get regular shipments in, making it easier to get your hands on the device in the crucial holiday shopping window.


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