To feed chips to iPhone 13, Apple cuts iPad production

Apple has cut back production of iPad tablets to allocate more components to the iPhone 13, a sign the chip supply crunch is hitting Apple harder than previously indicated
By REUTERS
| Updated on Nov 05 2021, 11:12 PM IST
Not just iPad tablets, parts intended for older iPhones too were being switched to the new iPhone 13.
Not just iPad tablets, parts intended for older iPhones too were being switched to the new iPhone 13. (REUTERS)

Apple Inc has cut back production of iPad tablets to allocate more components to the iPhone 13, a sign the global chip supply crunch is hitting Apple harder than previously indicated, Nikkei said on Tuesday, citing multiple sources.

Production of the iPad was down half from Apple's original plans for the past two months, the newspaper said on its website, adding that parts intended for older iPhones were also being switched to the iPhone 13.

Apple has weathered the supply crunch better than many other companies due to its massive purchasing power and long-term supply agreements with chip vendors, eating into its rivals' market share in the smartphone and tablet space in the third quarter.

However, Apple's top boss Tim Cook warned the impact of supply constraints will be worse during the current holiday sales quarter and the chip shortage is now affecting most of the company's products.

The iPhone maker is prioritizing its flagship 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 pandemic, Nikkei said, citing unidentified sources.

Moreover, a vacuum created by Huawei's exit from the market has shifted demand to players including Apple in China, which helped the company's sales in the last quarter. Apple posted a staggering 83% annual sales growth in China during the quarter.

The iPhone business, Apple's largest, raked in about $192 billion last year. The iPad business, which dominates the tablet space with over a third of global market share, brought in nearly $32 billion.

Apple says doubled business in India in fiscal ended September

(PTI) Technology major Apple earned nearly one-third of its revenue from emerging markets and doubled its business in India and Vietnam in fiscal 2021, according to its CEO Tim Cook said.

Apple posted a 29 per cent year-on-year growth in revenue at USD 83.4 billion in the fourth quarter ended September 25, 2021. Its net income stood at USD 20.55 billion in the said quarter as against USD 12.67 billion in the year-ago period.

Its total net sales stood at USD 365.8 billion during the fiscal ended September 2021.

"And we set quarterly records in every geographic segment with strong double-digit growth across the board. During fiscal 2021, we earned nearly one-third of our revenue from emerging markets and doubled our business in India and Vietnam," Cook said.

He added that Apple is "optimistic about the future, especially as we see strong demand for our new products".

According to Counterpoint Research, Apple was the highest growing brand in the September 2021 quarter in India with 212 per cent y-o-y growth and led the premium smartphone market (above 30,000) with a 44 per cent share.

The brand maintained its leading position in the ultra-premium segment (above 45,000 or USD 650) with a 74 per cent share, Counterpoint said.

Strong demand for the iPhone 12 and iPhone 11 were the major factors in Apple's growth and the company became the top 5G smartphone brand in the premium segment for the first time, it added.

In a statement, Apple said this year, it launched its most powerful products ever -- from M1-powered Macs to an iPhone 13 lineup -- that is setting a new standard for performance and empowering customers to create and connect in new ways.

Apple CFO Luca Maestri said the "record September quarter results capped off a remarkable fiscal year of strong double-digit growth, during which we set new revenue records in all of our geographic segments and product categories in spite of continued uncertainty in the macro environment".

The combination of Apple's record sales performance, customer loyalty and strength of its ecosystem drove its active installed base of devices to a new all-time high, he added.

"During the September quarter, we returned over USD 24 billion to our shareholders, as we continue to make progress toward our goal of reaching a net cash neutral position over time," Maestri said.

iPhone sales stood at USD 38.8 billion while that of Mac was at USD 9.1 billion, iPad at USD 8.2 billion, Wearables, Home and Accessories at USD 8.7 billion and services was at USD 18.2 billion during the September quarter.

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First Published Date: 05 Nov, 11:12 PM IST
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