Apple Stock price continued its downward trend on Monday as it was reported that the tech giant could suffer a shortfall in iPhone production of 6 million units due to problems at its primary manufacturing plant in China.
According to a story published on Sunday by Bloomberg, the instability might reduce manufacturing runs for the iPhone 14 Pro and Pro Max by approximately 6 million units heading into the crucial holiday season.
The Zhengzhou-based complex, which was the site of The 200,000-person Foxconn plant in Taiwan experienced violent protests last week as workers protested wages and working conditions. The facility continues to struggle with a labor shortage and rigid travel and movement restrictions. around the city. The protests were held in response to pay and working conditions in Taiwan’s Foxconn plant.
The previous week, hundreds of employees were filmed participating in a demonstration outside the plant in Zhengzhou called “iPhone City.” During the demonstration, some workers smashed windows and tore down barricades in response to allegations due to a previous instance of delayed bonus payments and hazardous working conditions outbreak of Covid.
Foxconn, the company that operates the Zhengzhou facility and is the largest iPhone assembler in the world, has refuted the charges and said that it is collaborating with Chinese authorities to safeguard the plant’s safety.
In trading early Monday, Apple shares were marked 1.95% lower to change hands at $145.23 per. This move would extend the stock’s one-month decline to approximately 6.65% if it were to continue.
Earlier this month, Apple warned that shipments of its higher-end iPhones would be reduced heading into the holiday season in most of its global markets because of constraints imposed by Covid at the facility that employs 200,000 people.
Foxconn stated on November 10 that it would adapt its production capacity in China and elsewhere to ensure that Covid-related shutdowns have a limited impact, but it also cautioned that December quarter smartphone revenues would likely drop on a year-on-year basis regardless of these adjustments.
Last week on Tuesday, the CEO of a leading Apple retailer, Corie Barry, stated that supply chain problems have led to a reduction in the availability of “higher-end iconic iPhone devices.”
Tim Cook, the chief executive officer of Apple, stated a month ago that iPhone demand has remained healthy. Still, he also mentioned that supply constraints for the 14 Pro and the 14 Pro Max continued to persist heading into the critical holiday season, even before the additional restrictions at Zhengzhou.
iPhone revenues were a significant component of Apple’s better-than-expected results for the September quarter, with sales climbing 9.6% from the previous year to $42.62 billion in total.
However, overall revenues increased by 2% from the previous year to an all-time high of $90.15 billion, which contributed to Apple’s fourth-quarter earnings total of $1.29 per share, which is above Wall Street’s expectations.
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