Due to a worldwide chip shortfall, Apple Inc is expected to reduce the manufacturing of its iPhone 13 by up to 10 million devices, Bloomberg News reported on Tuesday (Oct 12), citing individuals familiar with the situation.
As reported by Bloomberg, Apple intended to create 90 million copies of the new iPhone models by the end of the year. According to the source, Apple informed its suppliers that the number of devices will be reduced due to a shortage of components from chip suppliers such as Broadcom Inc. and Texas Instruments.
Texas Instruments and Broadcom also declined by roughly 1%, while Apple’s stock dropped 1.2 percent in the after-hours trade.
In July, Apple predicted slowed sales growth and warned that a chip shortage, which had already hampered the company’s ability to sell Macs and iPads, would also stifle iPhone production. In the same month, Texas Instruments issued a dovish revenue forecast, implying that chip supply issues for the remainder of the year would be a problem.
The chip shortage has put enormous strain on sectors ranging from automobiles to electronics, prompting several manufacturers to halt production temporarily.
Apple has weathered the supply crunch better than many other companies thanks to its massive purchasing power and long-term supply agreements with chip vendors. As consumers more likely want to upgrade the model to 5G, it was predicted that the iPhone 13 models released in September would have strong sales this year.