Ugliness around iPhone production, Travelin’ Tim’s off to Arizona, and no rest for developers.
Piper Sandler: Apple May Miss $8B in Holiday Revenue Over iPhone Issues
If you want a positive spin on Apple’s current quarter, just imagine how good it might make the same quarter a year from now look. I’m not saying it’s setting up an easy compare, but — yikes. AppleInsider has word of a note from analysts at Piper Sandler. That firm thinks Apple may see revenue drop eight-billion-with-a-b dollars this quarter, due to production problems for iPhone 14 Pro and iPhone 14 Pro Max. While the Piper Sandpeople think Apple “will try its best to catch up to some of the production in December,” November was really not good. The firm says utilization of Foxconn’s “iPhone City” plant in Zhengzhou, where most of the Pro phones are made, “may have fallen to 50% or below.”
That is the first time I’ve heard anyone say it might have been as high as 50%.
Open(ish) for Business
The good news — Zhengzhou is once again open for business, though there’s a lot that’ll make getting “back to normal” slow going for the Zhengzhou plant. Perhaps the biggest issue — well… who can say what the biggest issue is. There are a couple of huge ones though. One has to do with staffing. No doubt you remember the stories.
Workers fled the factory in October and November due to COVID fears, a lack of food, inadequate medical care, and the strains of working in a closed-loop system. Hiring has come in fits and starts, with one hiring push halted thanks to a lack of space for incoming workers to quarantine. Zhengzhou’s been in lockdown a time or two over the past couple of months. Problems with payment led a bunch of people who’d been hired to riot. Foxconn responded to that by paying them the money they were promised as a recruitment bonus to please go away.
Maybe hiring will go better this time, except for the other big issue: A piece from 9to5Mac highlights a Bloomberg report that says, despite the latest lockdown ending in Zhengzhou, iPhone City “remains in a closed-loop operation that curtails workers’ movement on campus, potentially complicating the effort to resume full production.”
Otherwise, it’s awesome.
So — Apple’s going to miss $8 billion in holiday revenue in Piper Sandler’s estimation. And yet — they are still all about the Cupertino-company. According to AppleInsider, “Piper Sandler says that overall, it continues to ‘believe that Apple remains a formidable brand.’” The firm maintains an “Overweight” rating on Apple shares. Piper Sandler’s price target on the shares is $195.
Counterpoint: iPhone 14 Pro Max Was Top-Selling Smartphone in China in October
Apple execs and investors looking for solace can find it in this: Before the production problems, the iPhone 14 Pro line was a hit. In fact, another piece from AppleInsider has new numbers for October from Counterpoint Research showing Apple’s latest Pro phones crushing it in China. The report has Counterpoint indicating:
…that one in four smartphones sold in China during October 2022 was an iPhone, with the iPhone 14 Pro Max being the country’s best-selling device.
While China’s smartphone market was down 4% from October to November, sales of iPhone were up 21% according to Counterpoint. Back out to year-on-year and Apple still did better than the rest of the smartphone market, though it did see decline. By the firm’s reckoning, AppleInsider says year-on-year, smartphones in China dropped 15% in October. Apple’s drop was only 4%, according to the report.
Tim Cook, President Biden to Attend TSMC Ceremony in Arizona
Look for Travelin’ Tim to travel next Tuesday. A Bloomberg report (via Yahoo! News) says that Apple CEO Tim Cook is headed to Arizona for ceremonies around the TSMC chip plant being outfitted there. Perhaps unusually, he will not be the most prominent person in attendance. Commerce Secretary Gina Raimondo and President Joe Biden will also be on hand.
Of course, that’s news for a day. The longer lasting news involves plans for the plant. Originally slated to make 5nm chips, secret people said to know something about something say the plant will instead produce 4nm chips. That move was decided “after US customers such as Apple Inc. pushed the company to do so,” according to the secret peeps. Quoting the report:
TSMC previously said it would make 20,000 wafers per month at the Arizona facility, although production may increase from those original plans, the people said. Apple will use about a third of the output as production gets underway.
That’s expected to happen sometime in 2024. TSMC will also “commit to adding a second nearby plant, which will make even more advanced, 3-nanometer chips,” according to the Bloomberg sources.
News for the Dev Types
New Round of OS betas Out to Apple Developers
While it may have been slowed by last week’s Thanksgiving holiday in the states, the big bam beta parade rolls on. A few pieces from MacRumors on Thursday had Apple seeding the fourth betas of iOS 16.2 and iPadOS 16.2 to developers, along with the fourth beta of macOS Ventura 13.1, watchOS 9.2, and tvOS 16.2.
App Store Connect Staying Open Over the Holidays
Not slowing for the holidays this year are App Store operations. Apple usually closes the App Store’s behind the scenes stuff around the Christmas holiday. Not this year, according to a piece from iDownloadBlog. “In years past,” says the report:
…the App Store freeze meant no new apps or updates for users to download during the holiday season. But during the 2022 holiday season, new submissions and updates to existing apps will keep flowing…
Good for developers, though kind of Grinchy sounding for the Apple people who actually have to do the work. Might be a skeleton crew, though. While the company says it is “pleased to remain open” and accept submissions, it does warn that reviews “may take a bit longer to complete from December 23 to 27.”
Wacko Maria Shows Off Special Edition Beats Flex
There’s another pair of designer Beats on the way. AppleInsider says the Japanese fashion house Wacko Maria has shown off a “limited leopard-print design” of Apple’s “Beats Flex entry-level wireless earbuds…” The piece says the new pair is meant to “match Wacko Maria’s Hawaiian-style shirts and clothing…” They’ll run buyers $70 — same as a regular pair of Beats Flex earbuds. If you’ve just gotta have ‘em, best o’ luck to ya. AppleInsider says:
It’s not clear whether the edition will only be available for a limited time, but it will be available from December 2, 2022, online or via selected stores in Japan.
Working Apple-1 and Other Apple Memorabilia Up for Auction
And finally today — why do we keep calling working Apple-1 computers “rare?” Seems like every time you turn around somebody’s selling one. And it seems like somebody just turned around.
9to5Mac says RR Auction has a new lot of Apple memorabilia up for bids, including one of the “rare” machines. According to the piece, the fully functional Apple-1 computer (not in a Data way) is “a Byte Shop-style version of the machine ‘complete with all components and accessories required for operation.’” Cooler than all of that, the piece says the board “was numbered “01-00002” by Steve Jobs himself…”
Be ready to spend big if you go for it. 9to5Mac says the machine is expected to fetch over $375,000.
Maybe that’s a bit rich for your blood. Or maybe you already have a working Apple-1, but want something from the Tim Cook era. You’re in luck. The same auction features an Auburn University football, signed by Apple’s current CEO. Auburn University is Cook’s alma mater. The football’s expected to go for somewhere over $1,000.
There’s other Apple kit up for auction as well. It’s all part of a 300+ item Science and Technology lot. Bidding is open on all of it now on the RR Auction site. The auction ends on 15 December — just in time for the holidays.
Today on The Mac Observer’s Daily Observations Podcast
I try to convince TMO Managing Editor Jeff Butts how great things will look for Apple in 14 months… provided nothing else… goes wrong. Also — Android is getting one communications app to rule them all (and ditch the green text bubbles to boot). Jeff fills us in on Sunbird on the Daily Observations Podcast from The Mac Observer.