Apple Inc plans to cut production of iPhones and AirPods as the Ukrainian crisis and looming inflation begin to affect demand, Nikkei reports citing sources.

The company plans to produce about 20% less iPhone SE next quarter or cut production orders by about 2-3 million units than originally planned due to weaker-than-expected demand.

The newspaper reported that the American tech giant also cut orders for its AirPods wireless headphones by more than 10 million units for all of 2022 due to sluggish demand.

Earlier this month, Apple introduced 5G connectivity to its iPhone SE, a low-cost model aimed primarily at buyers in emerging markets.

Counterpoint Research reported that the earlier 4G-enabled iPhone SE accounted for 12% of total iPhone sales from its launch in Q2 2020 through the end of 2021, with Japan being the largest market after the US.

The company also asked suppliers to produce a couple of million fewer units of the entire iPhone 13 lineup than previously planned, but that adjustment was based on seasonal demand.