As a tradition, whenever a disaster or disruption in a country occurs, the sale and purchase ratio of everything affects so much. The same is the case for iPhone sales and purchases in China. The disruption in china has affected everything so much and is still affecting them.
Apple’s massive iPhone estimate reductions keep coming as instability in China disrupts the company’s manufacturing schedule.
As per a recent Medium post by closely-followed TF International Securities analyst Ming-Chi Kuo, “the production of the Zhengzhou iPhone plant was significantly affected by laborers’ protests. So, I cut the 4Q22 iPhone shipments by about 20% to 70-75 million units (vs. the market consensus of 80-85 million units). “
The overall shipments of the iPhone 14 Pro and 14 Pro Max in 4Q22 will be 15-20 million units below expectations. According to Kuo, the shortage of iPhones will significantly hurt fourth-quarter revenue.
Apple’s iPhone revenue in 4Q22 may be much lower than the market estimate by 20-30% or more due to the high price of the iPhone 14 Pro series, Kuo continued.
Just as the nation was abandoning its zero-COVID policy, China’s COVID-19 cases soared to record highs. Last week, violent demonstrations broke out at Foxconn’s primary manufacturing facility for the iPhone, and they have now spread across the nation.
So, according to statistics from various sources, Wall Street experts presently anticipate that Apple will report fourth-quarter revenues of more than $125 billion. Earnings are anticipated to be $2.03 per share.
Kuo is one of many analysts who believe Apple will conclude the year with greater difficulty than anticipated.
Amit Daryanani, an analyst at Evercore ISI, stated in a note on Tuesday that Apple was “struggling to overcome a combination of shutdowns and worker protests at a major manufacturing plant in Zhengzhou, China, that resulted in Apple adversely pre-announced on Nov. 6.”
“Zhengzhou’s status seems to have improved considerably since that time, but it hasn’t returned to normal yet. We estimate that the facility has been running at 60 to 70% of its capacity for about a month.
Since the demand for iPhones may be impacted by 5-8 million units (mainly at the high end) and negatively influence sales by $5-8 billion in [the current quarter, which ends after December], we are lowering our [quarterly] expectations to reflect the ongoing headwinds.”
According to Wedbush Managing Director Dan Ives, Apple now faces “severe” iPhone shortages, which might cause 5% to 10% of handsets to be lost during the current quarter.
Wedbush Managing Director Dan Ives stated on Yahoo Finance Live that “it has been a gut hit at the worst possible time for Apple.” Regarding the iPhone 14, several Apple outlets have shortages of up to 30%.
In the previous month, Apple stock has fallen 9% amid the uncertainty, while the S&P 500 has up 1.4%.
Summary of The News
- The revenue of the iPhone has been reduced in China
- It is because of the disruption in China