Global chip shortage has become a serious issue for everything related to technology. While the shortage was impacting automakers initially, it is now also making a dent in the business of consumer electronics makers.
As the global chip shortage is hitting the smartphone industry, Apple has said that it could affect iPhone production and the company has also forecasted slowing revenue growth. This will also impact the tech giant’s services business.
Apple executives said that the revenue for the current fiscal fourth quarter will grow by double-digits but be below the 36.4% growth rate in the just-ended third quarter. They added that while the impact of the chip shortage was less severe than feared in the third quarter, it will get worse in the fourth, extending to iPhone production.
Tim Cook, CEO of Apple, said that chips affected by the shortages are made using older technology but those are still vital as supporting parts for making iPhones. Analysts believed that Apple could be stockpiling chips for its next-generation iPhone models.
There are several reasons behind the global shortage of chips, including factory closures due to the COVID-19 pandemic and increased demand for consumer electronics products during the lock-down and Work from Home setups.
The situation is not as bad for Samsung and Apple as with smaller phone manufacturers. HMD Global, which makes Nokia-branded devices, has warned that the semiconductor shortage could prove challenging for smaller device makers.
Reports indicate that many players in the mobile phone industry are struggling to procure a variety of semiconductors, including the struggle for sourcing power-management chips, display drivers, application processors, in addition to 4G and 5G chipsets.
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