After seemingly above ground for months, Apple has finally felt the brunt of the global chip shortage, according to a bloomberg report. Due to a component shortage, the company will cut its order for iPhone 13 units by 10 million units.
Earlier this year, Apple was expected to break the previous sales record with the iPhone 13. The iPhone 12 sold much faster than the iPhone 11, making it the first “supercycle” since the introduction of the iPhone 6S. Apple was predicted to go even further with the iPhone 13 series, according to a JPMorgan analysis, with an earlier Bloomberg report stating that Apple ordered an initial production run of 90 million units for the iPhone 13 Was.
As a result of chip shortages, Apple is reportedly unable to obtain enough chips from Broadcom and Texas Instruments to make these iPhones. Nerdshala has reached out to both suppliers for comment and will update this story when we hear back. From the Pixel 5a 5G to the Samsung Galaxy S21 Fan Edition (FE), chip shortages have already derailed phone launches, so the impact on Apple is mild by comparison. Apple has enough drag to get closer to its production target. Despite this setback, the company is in a stronger position than most of its rivals. Eighty million iPhones are still a lot of devices, and the average selling price of the iPhone 13 means there won’t be much of an impact on Apple’s pocket.
According to ReutersJeff Fieldhawk, associate director of Counterpoint Research, believes Apple has simply overordered and is scaling back its device orders to more accurately reflect demand. The research firm sticks to its forecast of sales of 85 million to 90 million iPhone 13 units for the fourth quarter.
Adding to Fieldhawk’s comments, Jan Strijk, another associate director of Counterpoint Research, told Nerdshala over email: “Our understanding is that Apple has contingency for serious shortfalls, and we will ask them to do some production for key components.” Let’s expect alternatives. For example, Apple was able to pivot rapidly to other suppliers when production was recently disrupted at supplier LG Display in Vietnam due to COVID. Overall, we believe that They have the ability to respond to current shortages in the supply chain. For key components, Apple is likely to have supplies as long as [the first or second quarter of] Next year. At this time, therefore, we remain on our [fourth quarter] iPhone 13 forecast in [85 million to 90 million] Category.”
Comments from Marta Pinto, senior research manager at IDC EMEA, were in the same vein. “Given that the market was expecting more than 90 million units, a drop of around 10 million units is physical but not extremely detrimental to the company’s performance,” Pinto told Nerdshala over email. “Maybe, in turn, customers will try to protect their devices in advance, which will make the new series even more successful.”
Pinto said the company will also be able to direct resources as needed for high-demand markets as it gets a more accurate picture of demand for individual iPhone 13 models in the first quarter of 2022.
TechSponential’s Avi Greengart, on the other hand, urged caution on the matter, saying: “It’s never a good idea to read too much into individual supplier reports, and it’s equally impossible to verify what Apple’s production targets are.” That said, the report is completely plausible: Apple makes iPhones in huge quantities, and these days there are many, cascading flaws affecting everyone’s supply chain — even That even Apple isn’t completely immune.
The iPhone 13 and iPhone 13 Pro have significant quality-of-life updates over the previous models. They come with bigger batteries for all-day battery life, better cameras for videography, and sharper screens for the Pro model. For more information, you can check out our full review.