In This Article:
(Bloomberg) -- Apple Inc. said shipments of its newest premium iPhones will be lower than previously expected after China lockdowns affected operations at a supplier’s factory.
Most Read from Bloomberg
-
Sam Bankman-Fried’s $16 Billion Fortune Is Eviscerated in Days
-
Hochul Wins NY Governor Race as GOP’s Zeldin Refuses to Concede
-
Binance Backs Out of FTX Rescue, Citing Finances, Investigations
The company continues to see strong demand for the iPhone 14 Pro and iPhone 14 Pro Max models but the lockdowns mean “customers will experience longer wait times to receive their new products,” Apple said in a statement Sunday. Deliveries of iPhone 14 Pro handsets are currently listed for late November or early December, according to Apple’s website.
Read more: Asian Apple Suppliers May Move as iPhone Outlook Cut on Lockdown
The abrupt move by the Chinese government last Wednesday to lock down the Zhengzhou area that includes a Hon Hai Precision Industry Co. iPhone assembly plant until Nov. 9 is expected to further disrupt a factory already grappling with an on-site coronavirus outbreak, worker exodus and enforced quarantine.
Apple said the facility is operating at “significantly reduced capacity,” while Hon Hai, the main listed arm of Taiwan’s Foxconn Technology Group, noted in a separate statement that it’s lowering its fourth-quarter outlook to factor in the lockdown.
“Foxconn is now working with the government in concerted effort to stamp out the pandemic and resume production to its full capacity as quickly as possible,” the Taiwanese company said in a statement.
Holiday Season
The local government has ordered people and vehicles off the streets except for medical or other essential reasons, a prohibition that threatens to cut off the flow of additional workers and components needed to rev up production ahead of the holiday-season crush.
The disruption comes at a crucial time for Apple, which launched the iPhone 14 during an unprecedented slump in global electronics demand. While faring better than other smartphone makers, it’s backed off plans to increase production of its new iPhones this year after an anticipated surge in demand failed to materialize, Bloomberg has reported. Apple has reported better-than-expected results but warned of a holiday slowdown.
The measures may further compound the headaches Foxconn and Apple are already facing as iPhones’ sales slow in China. Apple, the world’s most valuable company, said last month it expects growth to decelerate in the current period.