Apple’s Cash Cow Might Be in Trouble

Apple is set to announce its previous fiscal quarter earnings early next month. But that’s not stopping analysts from predicting disappointment.

In notes to investors on Thursday, both Bank of America Merrill Lynch, and J.P. Morgan analysts said Apple’s iPhone sales for the last quarter could have slumped below expectations, according to CNBC, which obtained a copy of those notes. The analysts cited Apple supplier Taiwan Semiconductor’s guidance to investors this week that put its second-quarter revenue at $7.8 billion to $7.9 billion. Analysts had anticipated second-quarter sales of $8.8 billion.

While Taiwan Semiconductor didn’t mention Apple by name, the company relies heavily on the iPhone to drive its quarterly performance. The chipmaker also said it’s suffering from “weak demand” in the mobile market.

The analysts’ warning on iPhone shipments is the latest in a string of reports suggesting Apple’s having trouble at the top of the market with its iPhone X. The cellphone, which costs $999 to start, is proving too expensive for customers, Mirabaud Securities analyst Neil Campling told investors this week. He went so far as to say Apple’s iPhone X would be discontinued this year due to poor demand.

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Several other industry watchers and pundits have also suggested iPhone X sales are slumping and putting a drag on the whole iPhone division.

For its part, Apple hasn’t commented on specific iPhone model sales. And since the iPhone X’s release in November, Apple hasn’t divulged unit sales for the model. It’s unknown whether the company will discuss iPhone X sales when it announces its earnings on May 1.

Still, the company has been bolstered of late by reports that things might not be as concerning as analysts would suggest. Earlier this week, market researcher Counterpoint said the iPhone X captured more profits than any other smartphone during the critical fourth quarter. Collectively, Apple’s iPhones generated 90% of the industry’s profits during the period, leaving scraps for other smartphone makers.

Either way, Bank of America Merill Lynch analyst Wamsi Mohan told investors on Thursday that the “magnitude” of weaker iPhone sales during the quarter “could be surprising to some.”

Apple did not immediately respond to a Fortune request for comment on the analysts’ report.

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