Apple Expects Supply Constraints to Continue in Q3 2022

[MacRumors]

Apple is expecting ongoing supply issues to continue to impact product sales in the third quarter of 2022. In the second quarter, Apple had some difficulty meeting demand for the iPhone, iPad, and Mac due to supply constraints, and that is going to get worse in Q3 2022.

Apple CFO Luca Maestri said that Covid disruptions in China and silicon shortages are making it difficult to make enough product to satisfy customer demand.

The supply constraints will cost Apple $4 to $8 billion depending on how long it takes suppliers in China to get back up and running. According to Apple CEO Tim Cook, the supply issues are all centered on the Shanghai corridor, and while almost all factories are now reopened, it will take some time for them to ramp back up to standard output levels.

As of now, the supply issues have primarily affected iPads and the higher-end MacBook Pro models. Cook says that going forward, most product categories will be impacted, and this will ultimately affect Apple's June quarter revenue.

Article Link: Apple Expects Supply Constraints to Continue in Q3 2022

 

[SalisburySam]

Outsourcing kharma.

 

[BootsWalking]

It's mine-blowing Apple could post the amazing revenue and profit numbers they did today and still could have sold even more product if it weren't for the supply chain issues.

 

[anshuvorty]

Isn't there a popular saying in the stock market regarding having a diversified portfolio is a safe way to invest?

I don't understand why it took a pandemic for Apple to think about diversifying its supply chain...if they had a diversified their supply chain, they wouldn't be thinking about losing 4-8B next quarter...insane...

 

[AF_APPLETALK]

It's mine-blowing Apple could post the amazing revenue and profit numbers they did today and still could have sold even more product if it weren't for the supply chain issues.

I suspect that part of this is the fact that most mac's can't be upgraded with aftermarket RAM or storage. That was a cheap little trick for Apple to boost profit margins.

 

[TheYayAreaLiving 🎗️]

I hope supply constraints wont be an issue in Q4. In Q4, Apple should be expecting a mega-cycle for the new iPhone 14 and Apple Watch 8.

 

[Random_Matt]

Constraints will continue into next year I reckon. Cannot build plants overnight.

 

[DBZmusicboy01]

I hope supply constraints wont be an issue in Q4. In Q4, Apple should be expecting a mega-cycle for the new iPhone 14 and Apple Watch 8.

I would cry... I just hope there's enough. I don't care about 2023 since it wouldn't be a big upgrade only the zoom lens. Tho 2024 iPhone is supposed to have zero notches/pill cuts. 100% display face ID underneath.

 

[DeepIn2U]

I hope supply constraints wont be an issue in Q4. In Q4, Apple should be expecting a mega-cycle for the new iPhone 14 and Apple Watch 8.

I have to disagree about a mega cycle. Many that wanted or needed to upgrade already have or just in the mids of doing so currently. This is why initial quarter sales blew all records and this quarter continue to do so.

That is not sustainable across the larger consumer base - which already fulfilled.

If you noticed this investor call specifically the USA has had record sales - no doubt to hardware upgrade yearly incentive and that’s still only a USA resident option.

I’ll wait for global irrefutable total iPhone ownership vs sales numbers but I’m willing to bet a LOT less iPhone SE (OG), iPhone 6/6S users out there as was a year ago.

 

[chikorita157]

Not too surprising since it's taking several weeks just to get a VESA Mount Apple Studio Display Regular Glass and my order still haven't shipped and I have until the end of May/Early June for the deadline for delivery with a possibility of it getting delayed. Also, these display, especially the VESA mount versions are nowhere to be found in stores for pick up.

I guess I'm done with my tech purchases for this year given the China lockdowns and the supply issues are about to get even worse. I will most likely replace my batteries in my Apple Watch 4 until the 9 comes out and hopefully Apple resolve their supply issues by then. There is not much to upgrade anyways after getting the 2021 MacBook Pro 16 and the Mac Studio, except for the watch, which I only really use for activity and heart rate/ECG monitoring.

 

[triton100]

And apple share price drops. They could post 1000% increase in every sector and they would still tank after market. Whereas other companies can only dream of these numbers and soar. The market is ridiculous.

 

[name99]

And no supply constraints in Q4 with the new iPhone?
Seems, uh, unlikely...

 

[spiderman0616]

And apple share price drops. They could post 1000% increase in every sector and they would still tank after market. Whereas other companies can only dream of these numbers and soar. The market is ridiculous.

The market is largely a scam, especially when it comes to Apple. Best to just ignore it.

 

[sudo-sandwich]

Isn't there a popular saying in the stock market regarding having a diversified portfolio is a safe way to invest?

I don't understand why it took a pandemic for Apple to think about diversifying its supply chain...if they had a diversified their supply chain, they wouldn't be thinking about losing 4-8B next quarter...insane...

It can be even more costly to be always preparing for unlikely disasters. They can take this relatively small loss and adapt. Covid was probably a net gain for Apple anyway since it forced so much public reliance on tech.

 

[sudo-sandwich]

And apple share price drops. They could post 1000% increase in every sector and they would still tank after market. Whereas other companies can only dream of these numbers and soar. The market is ridiculous.

A lot of expectations are already priced into that $2.67T valuation. If you think Apple is worth more than that, you can long.

 

[TheYayAreaLiving 🎗️]

I have to disagree about a mega cycle. Many that wanted or needed to upgrade already have or just in the mids of doing so currently. This is why initial quarter sales blew all records and this quarter continue to do so.

That is not sustainable across the larger consumer base - which already fulfilled.

If you noticed this investor call specifically the USA has had record sales - no doubt to hardware upgrade yearly incentive and that’s still only a USA resident option.

I’ll wait for global irrefutable total iPhone ownership vs sales numbers but I’m willing to bet a LOT less iPhone SE (OG), iPhone 6/6S users out there as was a year ago.

Nice insight! Dang, you are intelligent 👨🏿‍🏫 My question to you is...

Will you be upgrading and getting the new iPhone 14 with me this September? 🙇🏻‍♀️

 

[TheYayAreaLiving 🎗️]

I would cry... I just hope there's enough. I don't care about 2023 since it wouldn't be a big upgrade only the zoom lens. Tho 2024 iPhone is supposed to have zero notches/pill cuts. 100% display face ID underneath.

I agree! 2023, will definitely be a S year. However, sometimes S yearly upgrades are highly impactful and significant.

 

[bassexpander]

It’s fun trying to buy an ipad 9th gen in Korea. You buy it from Apple, there is a 1 month wait. You can find them all day at Hi-Mart, if you pay more. Sale in Apple products anywhere else? Price here remains the same. The sellers just make more money off of you. Korea is such a scam.

 

[erikkfi]

Yeah, supply constraints will continue all the way to the bank.

 

[AF_APPLETALK]

Not too surprising since it's taking several weeks just to get a VESA Mount Apple Studio Display Regular Glass and my order still haven't shipped and I have until the end of May/Early June for the deadline for delivery with a possibility of it getting delayed. Also, these display, especially the VESA mount versions are nowhere to be found in stores for pick up.

I guess I'm done with my tech purchases for this year given the China lockdowns and the supply issues are about to get even worse. I will most likely replace my batteries in my Apple Watch 4 until the 9 comes out and hopefully Apple resolve their supply issues by then. There is not much to upgrade anyways after getting the 2021 MacBook Pro 16 and the Mac Studio, except for the watch, which I only really use for activity and heart rate/ECG monitoring.

This is what I fear. The lockdowns are still going on over there from what I know, which means the backlog is going to take that much longer to fix.

I'm still primarily on an Intel machine and was planning on upgrading this year, but have fully accepted the fact that I might not be able to. In addition to the Intel machine, I also have an M1 Air with 16 GB RAM, but it seems to start chocking out when I spin up all of my developer tools so it's only good for on the go stuff.

 

[DeepIn2U]

Nice insight! Dang, you are intelligent 👨🏿‍🏫 My question to you is...

Will you be upgrading and getting the new iPhone 14 with me this September? 🙇🏻‍♀️

Not likely …. I need a full computer and that will be mid-tier MBP 14” SG and some investments.

The 14 series is not really appealing to me not with yet again a larger bump. Maybe, just maybe I’ll get a 13 Pro because of that blue but not holding my breath on that. Still love my mini.

 

[goobot]

It's mine-blowing Apple could post the amazing revenue and profit numbers they did today and still could have sold even more product if it weren't for the supply chain issues.

A lot of people are probably just on back order opposed to not buying at all, Apple probably didn’t loose out on many sales

 

[BuddyTronic]

Isn't there a popular saying in the stock market regarding having a diversified portfolio is a safe way to invest?

I don't understand why it took a pandemic for Apple to think about diversifying its supply chain...if they had a diversified their supply chain, they wouldn't be thinking about losing 4-8B next quarter...insane...

I’d say it’s no big deal to miss out on $4B to $8B revenue. It’s like missing a few days of revenues and that revenue is not necessarily lost - it could be deferred a bit. Longer wait times for iPad, that’s all it is

 

[scrapesleon]

Well maybe it’s time to move out of china

 

[KPOM]

The stock took a hit after hours.