According to people familiar with the matter, Apple may cut its 2021 iPhone 13 production target by as much as 10 million units, because its flagship product faces a chronic shortage of chips. Apple had expected to produce 90 million new iPhone models in the last three months of this year, but people familiar with the matter said that the company is now telling manufacturing partners that the total output will be reduced due to Broadcom Inc. and Texas Instruments. (Texas Instruments Inc.) is working hard to deliver enough components.
Apple is one of the world’s largest chip buyers, but even with strong purchasing power, the company is struggling to deal with supply disruptions that have caused severe damage to various industries around the world. Major chipmakers warned that the situation where demand continues to exceed supply will continue until the whole year of next year or beyond.
Apple obtains display components from Texas Instruments, and Broadcom is a long-term supplier of its wireless components. Apple is also facing shortages of parts from other suppliers. Companies such as Apple did not respond to media requests for comment.
After the news came out, Apple’s stock price fell more than 1% after-hours, and the stock prices of Broadcom and Texas Instruments also fell in after-hours trading.
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There are signs that the global chip shortage crisis is worsening. According to data from Susquehanna Financial Group, delivery time in the chip industry-the gap between chip orders and deliveries has risen for the ninth consecutive month, reaching an average of 21.7 weeks in September.
The chip shortage has affected Apple’s ability to deliver new models to customers. The iPhone 13 Pro and iPhone 13 Pro Max went on sale in September, but Apple’s official website currently shows that they will not be shipped until about one month after booking. Several retail stores also indicated that offline pickup is currently unavailable. Apple’s carrier partners have also seen similar shipment delays.
The current iPhone orders show that it will be shipped around mid-November, so Apple can still deliver the new iPhone to consumers in time during the critical holiday season. The market expects the year-end holiday season to be Apple’s largest sales blitz to date, generating approximately $120 billion in revenue. This will be an increase of 7% over a year ago.