Shares of Apple fell 1.4 per cent on Monday (Nov 28) as growing worker unrest at the world’s biggest iPhone factory in China fanned worries of a deeper hit to the already constrained production of higher-end iPhone 14 models.
Reuters reported on Friday that the Foxconn-operated plant could see a further drop in November shipments as thousands of employees quit amid discontent over strict COVID-19 restrictions to curb rising infections in China.
Separately, a Bloomberg News report citing a source said earlier in the day that there could be a shortfall of 6 million iPhone Pro units this year due to production-related problems.
The shortages kept many consumers from buying the high-end phones during Black Friday – the year’s busiest shopping period – and are likely to dampen sales in the crucial holiday quarter.
Wedbush Securities estimated that the production snafus could affect between 5 per cent and 10 per cent of iPhone units in the current quarter. KGI Securities analyst Christine Wang pegged the figure at around 10 million units, or 12 per cent, assuming the issues last through December.
Apple did not immediately respond to a request for comment.
“The ongoing challenges around delays in returning to a normal level of production at the Zhengzhou facility could limit the pace with which supply-demand equilibrium can be reached in the coming months,” JPMorgan analysts said.
US customers wait for about 33 days for their iPhone 14 Pro and Pro Max models to be delivered home, and the same models are not available for in-store pickup, the brokerage said.
Apple shares have fallen 3.4 per cent in November, compared with a 2 per cent gain in the Nasdaq Composite index.
The stock was among the biggest percentage losers in the Nasdaq 100 index on Monday, weighing on the broader market.
