iPhone 14 Pro impacted by Foxconn protests
Growing uncertainty in China around iPhone 14 Pro manufacturing has caused Morgan Stanley to lower its iPhone shipment forecast by an additional 3 million units in the fourth quarter of 2022.
“Now investors understand that the Dec Q will be challenged due to iPhone shortages, and so the most important near-term debate is really how much of the lost demand from December is perishable. versus reportable,” Morgan Stanley said. in the note. “We believe demand for the iPhone 14 Pro/Pro Max remains strong, supporting the idea that demand lost in December is more likely to be carried over to March than destroyed.”
Apple is still expected to report around $120 billion in revenue for the December quarter. The slowdown in iPhone production will lead to a 3% drop in revenue. That’s down slightly from the fourth quarter of 2021, which saw revenue of $123.9 billion.
Morgan Stanley sees the reduction in sales as a carryover rather than a total loss. People who still want the iPhone 14 Pro will buy one once supply catches up with demand, and that should be reflected in the March quarter.
