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Cuts in iPhone production affect a second round of suppliers


Over the past few days we have seen a number of rumors and indications that Apple may be cutting back on iPhone production in recent weeks. It can be given by many factors and we will hardly know the reasons why Apple has done it. However, who does seem to be affected by this are the suppliers who are in charge of assembling the iPhone and manufacturing its parts.

Cuts in iPhone production affect a second round of suppliers
Cuts in iPhone production affect a second round of suppliers

According to DigiTimes, Apple could have further reduced the production of the iPhone this year. A second round of order cuts affecting almost all of its suppliers. It is what happens when you depend mostly on one customer . As we have already seen, several companies have Apple as their majority customer, so an unexpected move by Cupertino’s has a direct impact on them.

Here it is most likely that Apple has supplied its stock for the Christmas campaign and now they are simply adjusting the demand for new iPhones to the Asian chain . Or maybe a bad forecast has caused them to cut back on demand. We don’t know and we won’t be able to know because these things are not shared by Apple and can only be intuited according to sources in the assembly line that only show a small part of the whole logistic complex.

At Apple, these six suppliers are so dependent on the iPhone that if it goes out of production, they lose more than half of their revenue

The Taiwanese chip maker seems to be the only one who is putting up with these cuts from Apple. As we already know, they are the ones in charge of manufacturing the A12 Bionic chip for the new iPhone and have been manufacturing Apple’s CPUs for iOS devices for years. This time, by making the jump to 7 nm and having more customers, can use their machinery and production capacity for other customers . Huawei has for example the new 7 nm Kirin 980 and Qualcomm is also preparing its 7 nm chip.

The conclusion? A lesson for providers s that depending on one client is not a good idea. Apple’s financial results may shed more light on the end of this fiscal quarter, as well as the results of the various suppliers. And maybe then we can get a better idea of what’s going on in Apple’s supply chain this year.