Apple fan-boys have proclaimed the Apple Watch a screaming success as Tim Cook explained he was "generally happy" with the launch. The big driver of the impression of awesomeness was how hard it was to get one... i.e. so much demand that supply copuld not keep up. However, as The Wall Street Journal reports, [6] it was not demand, it was instead defects that forced the company to limit supply.
It's been weak post-earnings...
And getting worse in the after-hours...
Apple Inc. is said to have found a defect in a key component of its watch during production, forcing the company to limit supply of the new device,. As The Wall Street Journal reports [6],
A key component of the Apple Watch made by one of two suppliers was found to be defective, prompting Apple Inc. to limit the availability of the highly anticipated new product, according to people familiar with the matter.
The part involved is the so-called taptic engine, designed by Apple to produce the sensation of being tapped on the wrist. After mass production began in February, reliability testing revealed that some taptic engines supplied by AAC Technologies Holdings Inc., of Shenzhen, China, started to break down over time, the people familiar with the matter said. One of those people said Apple scrapped some completed watches as a result.
...
Apple last week told some watch suppliers to slow production until June, without explaining why, according to people familiar with Apple’s supply chain. Suppliers were surprised because Apple recently said that Watch inventory was insufficient, these people said.
* * *
On Monday, Apple Chief Executive Tim Cook said “demand is greater than supply” for the Watch, but didn’t disclose sales or orders.
In a memo to retail-store employees earlier this month, Apple retail chief Angela Ahrendts said stores won’t get watches to sell until the end of May because of “high global interest combined with our initial supply.” New online orders will be delivered in June, Apple says on its website.
Which is true of course when you only have a handful to sell...
* * *


