According to reports, Apple will abandon plans to raise production of its new iPhones this year after an expected jump in demand did not materialize. Apple has informed its suppliers that it will reduce the production of up to 6 million iPhone 14 versions in the second half of the year.
This brings the total output count to around 90 million, which is close to last year and in line with the company’s earlier this year expectations. According to the report, an Apple supplier is thinking about making only high-end iPhones because the higher-priced iPhone 14 Pro models are more popular than the cheaper ones.
Apple’s Chief Financial Officer, Luca Maestri, said earlier this year that the conflict in Ukraine, which caused Apple to stop selling in Russia, would have a bigger effect on sales in the third quarter of this year.
On the call, he told analysts that supply-chain concerns would reduce sales by $4 billion to $8 billion in the third quarter, which would be “significantly larger” than the damage in the second quarter.
Chief Executive Officer Tim Cook stated that practically all of Apple’s Chinese plants performing final assembly have reopened following recent COVID-19 shutdowns, but the company does not know when the chip shortage, which is primarily affecting older models, will end.
The reduction in iPhone production has been a recurring issue for Apple, with the Cupertino-based tech corporation reducing its output last year as well. As a result of protracted chip shortages, it has decreased manufacturing by up to 10 million units.
Apple Inc. is a multinational technology company headquartered in Cupertino, California, that specializes in consumer electronics, software, and online services. With revenues of US$366.8 billion in 2021, Apple is the world’s largest firm by market capitalization, the fourth-largest personal computer vendor by unit sales, and the second-largest mobile phone manufacturer.
It is one of the Big Five American information technology businesses, along with Alphabet, Amazon, Meta, and Microsoft.
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