Apple shares slip as China factory unrest fuels iPhone supply concerns

– Shares of Apple Inc fell 1.4% on Monday as rising employee unrest on the world’s largest iPhone manufacturing unit in China fanned worries of a deeper hit to the already constrained manufacturing of higher-end iPhone 14 fashions.

Reuters reported on Friday that the Foxconn-operated plant may see an additional drop in November shipments as hundreds of workers stop amid discontent over strict COVID-19 restrictions to curb rising infections in China.

Individually, a Bloomberg Information report citing a supply mentioned earlier within the day that there might be a shortfall of 6 million iPhone Professional items this yr as a consequence of production-related issues.

The shortages saved many shoppers from shopping for the high-end telephones throughout Black Friday – the yr’s busiest buying interval – and are prone to dampen gross sales within the essential vacation quarter.

Wedbush Securities estimated that the manufacturing snafus may have an effect on between 5% and 10% of iPhone items within the present quarter. KGI Securities analyst Christine Wang pegged the determine at round 10 million items, or 12%, assuming the problems final via December.

Apple didn't instantly reply to a request for remark.

“The continuing challenges round delays in returning to a traditional degree of manufacturing on the Zhengzhou facility may restrict the tempo with which supply-demand equilibrium will be reached within the coming months,” J.P. Morgan analysts mentioned.

U.S. clients look ahead to about 33 days for his or her iPhone 14 Professional and Professional Max fashions to be delivered dwelling, and the identical fashions aren't accessible for in-store pickup, the brokerage mentioned.

Graphic: Lead occasions for higher-end iPhones stay elevated – https://graphics.reuters.com/APPLE-IPHONE/klpygkjlzpg/chart.png

Apple shares have fallen 3.4% in November, in contrast with a 2% acquire within the Nasdaq Composite index.

The inventory was among the many largest proportion losers within the Nasdaq 100 index on Monday, weighing on the broader market.