Apple (NASDAQ:AAPL)
Barclays said that December sales numbers from Apple’s Taiwanese suppliers are expected to continue the deterioration observed in November. They cited continuous supply interruptions and “waning demand” as the primary reasons for their prediction. Apple stock gained slightly during premarket trading on Monday.
Because of the supply chain disruptions at Foxconn’s plant in Zhengzhou, China, which is believed to be the location of the vast majority of iPhone production, an analyst named Tim Long, who has an equal-weight rating on Apple stock and a price target of $144 for the stock, noted that demand for the iPhone is likely to be “perishable.” In contrast to most experts, Long expects the demand to stay the same as Apple (NASDAQ:AAPL) during the company’s fiscal second quarter.
Long issued a statement to customers: “Based on our channel check talks, Zhengzhou plant utilization reached over 30% last week.” This was after November ended with a rate of about 20% utilization.
According to our estimations, usage might reach 50% by December. Our most likely scenario predicts that it will return to normal in the middle to late part of January at the earliest.
As a consequence, according to Long’s estimation, the Wall Street forecast of 78 million iPhones delivered in the current quarter might end up being off by as many as 15 million to 20 million since Foxconn is unable to ramp as quickly as was first anticipated.
“Recent disappointing sell-through statistics out of China (we have heard of drops of 20%-50% [year over year] lately) validates our pessimistic bias in the short term,” Long noted. “This is particularly true given considerable [iPhone 14] and [iPhone 14 Plus] demand difficulties.”
Apple (NASDAQ:AAPL) and Ericsson (ERIC) came to an agreement last week over a worldwide patent cross-license for the latter company’s proprietary cellular standard-essential technology.
Featured Image – Pexels © Armand Valendez
Author Shariq Khan 
