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Apple will lose 30% of its production due to protests in China

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We believe many stores are currently running low on the iPhone 14 Prountil 25%-30% below More than usual, this does not bode well for the Christmas season. China’s Zero Covid Policy Apple’s supply chain is a punch in the stomach“, warned Daniel IvesDirector of Analysis Webbush Securities In an interview on CNBC. According to his forecast, this Black Friday, the technology company sold 2 million fewer iPhones, or 14% less than expected, due to shortages.

On the other hand, the iPhone 14 Pro and Pro Max devices were the most requested this year, but the company was forced to reduce production (from 90 million units to 87 million).

Apple china.jpg

According to Evercore, a scenario where the Foxconn plant in China operates at 50% capacity for 7 or 14 days could result in a loss of up to $6 billion in revenue in the current quarter (December-March). Reuters reported that the plant is on track for a third consecutive week of below-normal operations and that the situation will not be resolved before the end of November.

For Apple, production of the iPhone is a critical issue it has dealt with on other occasions, but until now it has not coincided with the peak sales season for the product, which accounts for nearly half of the company’s global direct revenue.

Rising interest rates and debt burdens have pushed down the valuation multiples of stocks significantly. The recession and inflation affected the business prospects of most technology companies. However, Apple has been almost immune to all of these to date. Now experts see a crisis that reveals its great Achilles heel: the model of making the iPhone in China and exporting it to the rest of the world from there.

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