Shares of the telecommunications and information technology giant Apple fell on Tuesday, affected by reports indicating the company’s intention to cut production targets for the iPhone 13 smartphone due to the continuing shortage of electronic chips worldwide.
Apple was aiming to produce 90 million phones of its new model in the fourth quarter of 2021, according to a report published by Bloomberg Economic Network.
But the current reality indicates that the company has to announce that its production will decline by about ten million smartphones of this model, according to a Bloomberg report.
Apple shares fell about 1.2 percent at the end of the trading session on the New York Stock Exchange on Tuesday, due to reports of cutting production targets.advertisementhttps://0dc0dcad0d1d81cf4c745e0de89b56dc.safeframe.googlesyndication.com/safeframe/1-0-38/html/container.html
Shares of Broadcom and Texas Instruments also fell by about 1.00 percent, after talk about their difficulties in supplying Apple with sufficient quantities of electronic chips on the agreed dates.Skip topics that may interest you and keep readingTopics that may interest you
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The BBC has contacted Apple, Broadcom and Texas Instruments for more details on this news.
Apple launched four new iPhone 13 models last September: iPhone 13, iPhone 13 mini, iPhone 13 Pro, and iPhone 13 Pro Max.
Consumer orders began to be received on September 17, with orders beginning to be shipped on the 24th of the same month.
The electronic chip crisis
Millions of products in various sectors rely on electronic chips to be able to operate, amid rising demand for semiconductors that is pushing chip companies to operate at full capacity to meet their obligations.
The damage caused by the glaring shortfall in semiconductors was not limited to smartphone companies that buy most of the electronic chips, such as Apple, as the impact extended to other sectors such as the auto sector and the video game platform industry.
Apple CEO Tim Cook warned investors in July that the semiconductor crisis could negatively affect sales of iPhone and iPad tablets.
Estimates prepared by Wedbush Investment Services Group indicated that Apple could suffer a shortfall of about five million iPhone 13 smartphones in the upcoming holiday season if consumer demand continues to increase as quickly as smartphone orders are shipped through the end of this year.
However, Wedbush analysts Daniel Ives and John Katsengris do not see the lack of chips as “a cause for concern”, as they expect smartphones of this model to be available in early 2022.
Wedbush analysts said: “Falling back from production targets of about 5-10 million units by the end of the last quarter in December and entering the first quarter of the new year ending next March, due to known supply chain disruptions, is not a cause for concern. It also ultimately points to a stronger trajectory for demand that exceeds Wall Street expectations.”
They added, “We see the news released in this regard as nothing more than an industrial bump in the way of the superior sales of iPhone 12 and 13 phones, which continue to show further progress.”
Other analysts echoed the same view that the chip deficit is not a cause for concern about Apple’s iPhone 13 sales, and that these phones will see a big rise in sales in the new year as consumers look to upgrade their phones to prepare for 5G networks.
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