There is a good bit of uncertainty swirling around Apple (NASDAQ:AAPL) lately, but it would seem that the company is ramping up production based on reports that Foxconn (FXCNY.PK) has been increasing hiring.
According to KGI Securities analyst Ming-chi Kuo — who has a proven track record of predicting products, releases, and performance — Apple could be running behind on the estimates a lot of other analysts have been making. He cited potential problems with the technology in the iPhone 5S, iPad Mini 2, and a low-cost iPhone that would push launch dates past the average forecasts.
However, one indicator that could signal that Apple’s situation is not as bad as rumored is an increase in laborers producing the devices at Foxconn. According to executives familiar with matters at Foxconn, the company has been adding 10,000 new employees per week since the end of March to fill the production needs for the new iPhone.
An official spokesman for the company was less detailed in explaining the increase in hiring, merely stating that it was to meet the seasonal demand from clients. However, another person familiar with the matter also claimed that the increased hiring was targeted directly at Apple production…
Having all hands on deck could be important for Apple, as Samsung and HTC have their latest flagship devices coming out within the next couple weeks, which could make summer competition fierce. A compilation of many Bloomberg analysts’ estimates indicate that Apple’s fiscal second quarter has produced the company’s worst sales growth since 2009. Following that quarter up with increased performance and an ample supply of new devices could help the stock recover from a lot of the negativity surrounding it.
A lower-cost iPhone could also help Apple steal back some market share from Samsung, but the actual existence of such a device is still debated. Kuo said that the company is making the device, but it could take away sales from the original iPhone, which has better margins, thus decreasing profits for Apple. Chief Executive Officer Tim Cook even said the company wasn’t working on a budget iPhone back in February.
So, while there is still uncertainty around what will happen with Apple next, a new slew of products is almost sure to improve the company’s value, though when those products will actually come out is still being debated.
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