Apple said on Sunday that COVID-19 restrictions at an iPhone factory in China have “temporarily affected” shipments of its flagship phone.
The world’s most valuable company said a facility in Zhengzhou run by Foxconn, one of Apple’s largest suppliers, was “currently operating at significantly reduced capacity.”
“We continue to see strong demand for iPhone 14 Pro and iPhone 14 Pro Max models,” Apple said in a statement. “However, we now expect lower iPhone 14 Pro and iPhone 14 Pro Max shipments than we previously anticipated and customers will experience longer wait times to receive their new products.”
UBS analysts said on Sunday the delay could affect “several millions” of the roughly 41 million phones Apple is estimated to build in the quarter.
“The confluence of Covid disruptions and solid demand for the high-end models will lead to longer wait times for customers to receive their products,” the analysts wrote in a note to customers late Sunday.
Foxconn, as Hon Hai Precision Industry is known, has converted its factory in Zhengzhou into a closed loop factory due to concerns about COVID-19 in the area, according to a report last week from analysts at Morgan Stanley.
About 60% of Foxconn’s iPhone assembly takes place in Zhengzhou, Morgan Stanley analysts wrote in the report.
“However, we believe that the impact of the COVID situation in Zhengzhou is becoming apparent in iPhone turnaround times as the turnaround times of the iPhone 14 Pro and Pro Max have been extended by ~7 days in the past week, to 26 days from Tuesday, Nov. 1st,” the analysts wrote.
Taiwan-based Foxconn released a current-quarter forecast on Monday, saying it was originally “cautiously optimistic,” but “due to the pandemic affecting some of our Zhengzhou operations, the company will update its fourth-quarter outlook.” adjust down’.”
The company said the local government has “made it clear that, as always, it will fully support Foxconn’s local production”.
“Foxconn is now working with the government in a concerted effort to eradicate the pandemic and resume production at full capacity as soon as possible,” the company said in a statement.
Apple said it is “working closely with our supplier to return to normal production levels while ensuring the health and safety of every employee.”
Taylor Dunn of TBEN News contributed to this report.