Apple is cutting orders to vendors for its iPad tablet computers that could lead to slower sales for supply-chain vendors, according to a report from JP Morgan Chase and Co.

Apple has lowered fourth quarter iPad orders by about 25 percent according to several supply-chain vendors. This is the biggest cut that Apple has ever done. The report didn't mention any companies that had been affected by the supply order cut but for vendors such as Hon Hai Precision Industry Co. it could mean a drop of up to 13 million units in the fourth quarter.

One reason behind the cut analysts say is the weakening demand in Europe due to economic woes. It could also be a strategy by Apple to reduce inventory to drive up demand according to Wanli Wang, a Taipei-based industry analyst at RBS Asia Ltd., said today.

"It's back to reality," Wang said. "Now it seems even for Apple, due to the market situation, we need to be conservative."

Apple is currently dominating the tablet computer market. It accounts for 73 percent of market share. The nearest competitors to the iPad's dominance like Samsung's Galaxy Tab and Google's Android tablet only accounts for 17 percent of the market. Other tablets like Hewlett Packard's TouchPad have all failed to make a dent to Apple's sales.

The slowdown to Apple's orders could also mean that the company is gearing up to release its next generation iPad. The iPad 3 is rumored to be launched next year with better resolution and a faster processor.

So far Apple has failed to comment on the report that it has reduced orders to supplier. Representatives from Hon Hai also didn't comment on the report.