This year, Apple is expected to produce only 220 million iPhones, which is a severe setback for the company’s growth trajectory. Analysis shows that this year’s output rate is over 20 million less than demand.
No matter how bad things got for people and businesses alike throughout the pandemic, Apple never stopped setting new records in the wake of it. There are always new heights in technology sales, with year-on-year revenue growth of up to 5.5%. Because of this, this year has been a slow one for the corporation, with even manufacturing on a shaky slope.
There is no doubt that the slowdown in output is not due to a decrease in demand. There has been a dramatic increase in Apple’s demand, according to the census, since 2012. What has changed is that the iPhone 14’s production now faces challenges that were previously absent.
The scarcity of chips is the most pressing of these issues. The pandemic is one of several factors that have contributed to the food shortage. There is a lack of technology because of COVID. Cities across China have been put under full lockdown, delaying production of all types.
Secondly, as the pandemic makes greater use of technology, the demand for chips has risen, resulting in increased consumption around the world. Chips are also becoming more and more popular in the vehicle industry. Surprisingly, the corporation is running out of the minor chips used for low-grade processing, not the larger ones. According to reports, the manufacture of the iPhone 14 has already fallen a month behind schedule. In addition, the high inflation has made it impossible to raise enough money to fund new product development.
Due to these and other factors, Apple was forced to reduce manufacturing from a projected 240 million units to 220 million units this year, a choice that they regret. As a result of the decrease in production, the stock price has already fallen. It is still unclear if Apple will be able to absorb over 8 billion dollars in losses, despite the company’s warnings.