Even though the supply chain situation that affected Apple terribly has improved significantly, there can still be a hindrance to the iPhone 13 lineup’s production in Q4 2021, believes JP Morgan. Analyst Samik Chatterjee states that it has become a concern for Apple to look at supply constraints with the imminent Covid-19 resurgence and a terrible hit to production due to recent power usage restrictions in China.
The JP Morgan analyst notes the production ramping up process on iPhone 13 lineup is moving forward at a slower pace than it was on earlier iPhones and the main bottleneck behind this is the camera module issues.
While Covid cases and multiple restrictions have contributed to the sluggish production in Vietnam, the root cause revolves around the supplier ramp of sensor-shift optical image stabilization. But the situation will improve as restrictions will be relaxed and LG Innotek’s camera facility along with a secondary unit in South Korea is set to boost the production at a pace that is required.
There are more issues hovering over iPhone 13 supply as smaller components may be terribly impacted if the power shortage issues in China persist. However, larger components are out of trouble for now so that’s good news. The analyst believes 5-10 million units out of the 143 million planned units could be affected due to this. But despite that, Apple continues to stay in a comfortable position in terms of sales.
The analyst maintains his Apple price target of $180, based on a price-to-earnings multiple of 28x on JP Morgan’s 2023 earnings estimate of $6.55.
Related:
- Apple could be required to pay $46 million in undeclared benefits in Korea – Gizmochina
- Apple users do not find new iPhone 13 very exciting, survey shows (gizmochina.com)
- Apple iPad mini 6 users face LCD discoloration and distortion issues – Gizmochina
(via)
