Supply chain woes will delay, not dent, iPhone 13 sales

iPhone 13 Pro — great camera, if you can get it

KeyBanc analyst John Vinh has added his voice to a wave of industry watchers reporting the extent of Apple’s iPhone component shortage. He also joins the chorus in considering scarcity will simply create pent-up demand into the next quarter.

Demand and supply

Vinh says his survey across U.S. carriers shows robust demand for iPhone 13 devices. He notes that most stores have only limited inventory of the iPhone 13 and iPhone 13 mini and no iPhone Pro/Max models.

In a one more thing moment, the analyst also notes that when a 13-series model isn’t available “many customers” are choosing to buy an iPhone 12 instead. While he sees these factors as a negative in the current quarter, he also sees demand feeding coming quarters.

A note from Wedbush analyst, Daniel Ives, chimes the same note. “Heading into Black Friday we continue to see delivery times for Apple’s iPhone 13 Pro lengthen as we estimate right now demand is outstripping supply by roughly 15% heading into this holiday season,” he writes.

He also agrees delays will simple feed sales into subsequent quarters.

The conflict here is a good one to have.

Some good economics in play

While Apple has admitted to problems meeting demand, it has also confirmed higher demand than many anticipated. In other words, people want these iPhones.

A couple of recent factoids bear this narrative out:

• In China, JD.com sold $15.6 million units by value of iPhone 13 in just two seconds during a national sales event, called ‘Singles Day’. Chinese retail websites went down under the demand for these things. Estimates claim Apple sold over 5 million iPhones on the day.
• In Vietnam the company set new records, with some local reports claiming a tripling of sales there.

Lady with a new iPhone

• Apple re-took second place in global smartphone sales in Q3 2021. Sales climbed 14% and it shipped over 49 million iPhones in that time, according to Canalys.
• At the beginning of November, we heard reports that Apple has scaled back iPad production to allocate chips to iPhone 13 manufacturing.

With so much demand, Apple is being impacted by chip shortages in the APAC region. These are exacerbated by additional labour and logistics challenges in some SE Asia nations, wrote Yin Yeping of Global Times. Industry insiders say the chip shortage will last at least until Q1 of 2022, Yeping notes.

[Also read: Apple may need to delay 3nm iPhone chips, report claims]

Apple for number one?

Apple during its recent fiscal call confirmed record iPhone sales, customer satisfaction of 98% and high services attachments across its iPhone customers.

Canalys Research Analyst Le Xuan Chiew thinks Apple may achieve the top slot in smartphone sales in the next quarter, saying: “Apple is a sourcing powerhouse, its high-end devices make it less exposed than many competitors, and it will be aiming for the number one spot next quarter.”

However, with such high demand it seems inevitable we’ll see some customers forced to wait a few more weeks.

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