A report on Tuesday says that Apple is reducing its production of iPads in order to prioritize chip production for the iPhone 13 line.
Supply Chain Shortages
Two sources claimed that iPad production was down 50% in the last two months. Additionally, parts meant for older iPhones are also being moved to the iPhone 13. Apple expects stronger demand for the new iPhones over the new iPads.
The iPad and iPhone models have a number of components in common, including both core and peripheral chips. This allows Apple to shift supplies between different devices in certain cases.
The company is prioritizing iPhone 13 output in part because it forecasts stronger demand for the smartphone than for the iPad as Western markets begin to emerge from the coronavirus pandemic, sources said. Europe and the Americas account for 66% of Apple’s revenue.
In the company’s latest earnings report, Apple showed strong growth but also avoided offering guidance for future quarters, starting this trend earlier during the coronavirus pandemic. Apple CFO Luca Maestri did caution analysts that iPad revenue would drop due to supply chain constraints.
As one example, estimated delivery times for the new iPad mini are listed as December 2 – December 9.