What you need to know
- The world's largest iPhone maker says that the component shortage is easing.
- Foxconn says we can expect a major improvement in parts shortages in the first quarter.
- The company is the largest producer of Apple's iPhone.
Apple supplier Foxconn says we can expect major improvements to the component shortages that have plagued Apple's supply chain as early as Q1 of this year.
As Bloomberg reports:
The biggest assembler of iPhones said component shortages that have plagued electronics production for more than a year are showing signs of easing, a potentially encouraging signal for manufacturers across industries. There will be a major improvement in parts shortages in the first quarter, with "overall supply constraints" set to ease in the second half, James Wu, a spokesman for Hon Hai Precision Industry Co., said during a company event in Taipei on Thursday.
Foxconn is the world's largest supplier of all of Apple's best iPhones including the iPhone 12 and iPhone 13. Despite some resilience even Apple has suffered as a result of component shortages, most notably with its iPad line.
Apple revealed at its most recent earnings call that iPad revenue fell 14% year over year due to "very significant supply constraints" and strong demand. Apple noted that it expects to see an improvement in the March quarter. It was reported last year that Apple had slashed iPad production to keep up with iPhone demand:
Apple has reportedly slashed its iPad production numbers so that iPhones can be manufactured more quickly. If reports are accurate, Apple has told suppliers to reduce iPad capacity by as much as 50% to allow iPhones to be given priority.The report, from Nikkei Asia, notes that iPhones and iPads have "a number of components in common." By moving those components from iPads to iPhones, Apple is able to get more smartphones into stores more quickly.
Apple is reportedly readying a new iPhone SE and iPad Air for launch at a March event next month.
