Apple to Cut iPhone 13 Production due to Global Chip Shortage

Apple is likely to cut production of its iPhone 13 by 10 million units due to the global chip shortage, Bloomberg News reported on Tuesday.

The company was expected to produce 90 million units of the new iPhone by the end of this year, but sources familiar with the matter have informed Bloomberg that Apple has told its manufacturers that the number of units would be shrunk as chip suppliers are struggling to deliver the needed components.

Apple had previously said in July that it expects slowing revenue growth and that the global chip shortage would also influence its iPhone production, just like it has many other electronics and car manufacturing companies.

Of course given its massive purchasing power and long-term supply agreements with chip vendors, Apple has weathered the supply issue storm better than many other companies, leading analysts to forecast that iPhone 13 models released in September would still have a strong sales year.

Indeed, Jeff Fieldhack, research director for Counterpoint Research, said iPhone 13 sales appear to be healthy and higher than last year's iPhone 12, and Counterpoint is not changing its estimate of 85 million to 90 million iPhone 13 sales for Apple’s Q4.

Regardless, news of production cuts have caused Apple stock to fall 1.2% in after-hours trading.

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