iPhone 14 Pro shipments will be “lower than expected” after a factory lockdown in China linked to anti-COVID restrictions, Apple has warned, bad news as the holiday season approaches.
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Apple said its main production site in Zhengzhou (center) “is currently operating with significantly reduced capacity” since the discovery of a cluster of positive COVID-19 cases.
“Customers will have to wait longer to receive their new products,” the American group said in a press release on Sunday evening.
“As we have done since the start of the pandemic, we are prioritizing the health and safety of workers in our supply chain,” adds the apple brand.
The Taiwanese group Foxconn, Apple’s main subcontractor, has been facing an increase in COVID-19 cases since October at its huge site in Zhengzhou, the largest iPhone factory in the world.
Foxconn for its part announced that it “revised (had) downwards” its financial forecasts for the end of the year.
“The group’s outlook for the fourth quarter was initially ‘cautiously optimistic’, but due to the pandemic affecting some of our operations in Zhengzhou, the company will revise this outlook downwards,” Foxconn said in a statement.
“Foxconn is now working with authorities in a joint effort against the pandemic, to resume production at full capacity as quickly as possible,” he added.
The company did not specify the extent of the impact of the containment on its financial results.
Sanitary bubble
Foxconn has also announced on the social network Wechat new measures for its employees, in particular a “sanitary bubble” between the dormitories and the factory.
Employees who continue to work will be grouped in three dormitories, the group said.
First confined, hundreds of employees exasperated by their living conditions fled the factory in disaster last week.
“Normally, almost all iPhones are produced in Zhengzhou,” Ivan Lam, an analyst for specialist firm Counterpoint, told AFP a few days ago.
The apple brand depends a lot on China, where it has more than 90% of its products manufactured. The country is also one of its most important markets.
Unlike its neighbors in Silicon Valley, Apple has so far weathered the economic crisis well, even as the strong dollar weighs on its revenue.
From July to September, the American group saw sales of the iPhone, its flagship product, increase by 9.7% over one year, to 42.6 billion dollars.
For the holidays, the company and experts expected strong demand for the iPhone 14 and 14 Pro Max.
Foxconn is the largest private-sector employer in China, with more than one million people working at its approximately 30 factories and research facilities in the country.
Located about 600km from Beijing, the Zhengzhou industrial site employs up to 300,000 people who live there year-round, in “iPhone City”, a sort of city within the city.