Morgan Stanley cuts iPhone shipment estimates by another 3 million units - CNBC

Morgan Stanley reduced its Apple iPhone shipment forecast for the December 4th by an further 3 cardinal units connected Wednesday to relationship for slower accumulation successful China. The steadfast had already chopped shipment expectations by 6 cardinal units successful November.

Morgan Stanley present expects Apple to vessel astir 75.5 cardinal units, down from its archetypal forecast of 85 cardinal units. It comes arsenic Apple suppliers look turmoil successful China.

Last month, mill employees clashed with information unit astatine the Zhengzhou works successful China, the world's largest iPhone mill tally by Apple's assembly spouse Foxconn. The mill was besides deed by a Covid-19 outbreak in October that caused workers to fly the facility as the institution moved to power the outbreak by isolating infected people.

Morgan Stanley analysts said the unrest volition interaction what is historically Apple's biggest quarter, which is often bolstered by the vacation buying season. The analysts expect Apple volition study astir $120 cardinal successful December 4th revenue, resulting successful a 3% interaction from the slower production. Apple reported $123.9 cardinal successful its archetypal fiscal 4th this year, up 11% implicit 2021.

Shares of Apple were down astir 1% aboriginal Wednesday.

Despite the expected dip successful shipments and revenue, the analysts said the forecast does not needfully bespeak slowing demand.

"By present it's good understood by investors that the Dec Q volition beryllium challenged owed to iPhone proviso shortages, and truthful the astir important near-term statement is truly however overmuch of the mislaid request from December is perishable vs. deferrable," they wrote successful a Wednesday note. 

"We judge request for the iPhone 14 Pro/Pro Max remains solid, supporting the presumption that mislaid request successful December is much apt to beryllium deferred into March than destroyed."

Apple did not instantly respond to requests for comment.

CNBC's Michael Bloom contributed to this report.