Production of Apple‘s flagship iPhone 13 smartphones fell 20% short of previous plans in September and October as it has struggled to keep up with the global chip shortage and supply chain disruptions.
The holiday-quarter is one of the busiest for the company as many consumers seek to buy its products as gifts, weeks ahead of Christmas.
However, after launching the iPhone 13 range and new iPads in September, a major threat looms over Apple.
Chief executive Tim Cook said in October that the impact of supply chain challenges would be worse during the holiday sales quarter than it was in the previous quarter.
In October, for the first time in more than a decade, iPhone and iPad assembly was halted for several days due to supply chain constraints and restrictions on the use of power in China, Nikkei reported.
Reallocation of Components
Japan’s Nikkei reported that through September and October, the reallocation of the shared components squeezed iPad assembly even more, leading to about 50% less production volume than planned.
The production forecast for older generations of iPhones also dropped around 25%, it reported.
Additionally, Apple told its parts suppliers that demand for the iPhone 13 lineup has slowed.
Early data on China iPhone 13 pre-sales showed strength, analysts said. Data from JD.com showed 2 million orders by the end of the September 16 launch date, compared with 1.5 million orders on the first day of iPhone 12 pre-orders.
“We believe the strength in sales was driven by lower average selling prices by Apple and JD’s promotion to offer one year of Apple Care for free, roughly equal to a 15% price discount,” Jefferies analyst Edison Lee said.
- Reuters with additional editing by George Russell
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