Apple's iPhone Pro

Apple’s iPhone Pro shipments may fall 20 million units short of estimates

Shipments of Apple Inc’s iPhone 14 Pro and Pro Max models could exceed market expectations by 20 million units in the holiday quarter due to labor unrest at a key Chinese factory, TF Securities analyst Ming-Chi Kuo said.

Kuo is the latest to hit the world’s most valuable company with protests over wages and strict COVID-19 restrictions at the world’s largest iPhone factory, a Foxconn-run plant in the central city of Zhengzhou.

He cut his estimate for quarterly iPhone shipments by about 20% to between 70 and 75 million units, compared with the market consensus of 80 to 85 million units.

Apple shares were trading down more than 2%, adding to a 6% drop this month on growing concerns about shipments in the all-important holiday sales season.

In a blog post-Tuesday, Kuo also predicted that the tight supply could erode demand for the more popular Pro model rather than boost sales, as consumers also grapple with a weak economy.

By contrast, other Apple analysts expect sales to pick up once production shortages ease and more Pro models become available.

“We see that Pro devices tend to sell out in early January, but we expect some of the lost revenue to be made up in the March quarter,” CFRA Research analyst Angelo Zino said on Monday.

Zino said the outages come at the worst possible time and are among the most severe since the early days of the pandemic.

Some analysts indicated the possibility of an increase in challenges in 2023.

“I can’t imagine 2023 being a strong year for Apple’s iPhone,” said Zeno Mercer, a research analyst at investment advisory firm ROBO Global.

“People who want to upgrade and otherwise have less disposable income should go for the next-generation phone.”

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