Bloomberg News reported on Tuesday, citing informed sources, that Apple is likely to reduce production of its new iPhone 13 by up to ten million units due to the global chip shortage. Bloomberg noted that Apple was expected to produce 90 million units of its new iPhone models by the end of this year. The report added that Apple has informed its manufacturers that the number of devices will shrink because chip suppliers, including Broadcom and Texas Instruments, are struggling to deliver components.
Apple's shares fell 1.2 percent after hours of trading, while shares of Broadcom and Texas Instruments dropped about one percent. Apple declined to comment, and neither Broadcom nor Texas Instruments have responded to requests for comment. In July, Apple had forecast slower revenue growth and stated that the chip shortage, which has started to affect its ability to sell Mac laptops and iPads, would also limit iPhone production. Texas Instruments provided cautious revenue forecasts that month, hinting at concerns about chip supplies for the rest of the year.
The chip crisis has placed immense pressure on various industries, from automotive to electronics, prompting some car manufacturers to temporarily halt production. Due to its substantial purchasing power and long-term agreements with chip vendors, Apple has managed to avoid supply crises more than many other companies, leading analysts to predict strong sales for the iPhone 13 models launched in September, as tech enthusiasts look to upgrade their devices to 5G networks. However, Counterpoint Research noted in a research memo last month that Apple is not immune to the global chip crisis. They lowered their global smartphone shipment forecast to 1.41 billion units from 1.45 billion earlier, stating that while the iPhone manufacturer is in a better position than its competitors, it will still be affected.
