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In addition, a wave of analysts have downgraded their view on the company’s stock lately, citing what they have seen as indications of underwhelming iPhone sales. Wall Street now estimates iPhone unit sales grew by only 2% last quarter from the same period a year earlier, and it forecasts sales of Apple’s flagship product will actually drop in the current quarter by 5%.
The U.S. company had initially told parts makers to keep production of the iPhone 6s and 6s Plus for the quarter at the same level as with their predecessors -- the iPhone 6 and 6 Plus -- a year earlier. But inventories of the two models launched last September have piled up at retailers in markets ranging from China and Japan to Europe and the U.S. amid lackluster sales. Customers saw little improvement in performance over the previous generation, while dollar appreciation led to sharp price hikes in emerging markets. Output will be scaled back to let dealers go through their current stock. Production is expected to return to normal in the April-June quarter, once inventory adjustment is complete. Apple's products and brand have not lost their appeal, and older models have continued to sell.
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