We’ve seen several conflicting reports over the last month or so about how the COVID-19 coronavirus pandemic has or has not affected Apple’s supply chain and its prospects for on-time releases of its products, including the “iPhone 12.” A report from The Wall Street Journal provides more information about the ever-changing situation.
Today’s report from The Wall Street Journal cites former Apple employees and provides more information on the company’s production process:
Apple’s new flagship models are usually unveiled in September, so the 5G phones are months away. However, the company’s operations team typically places orders in March and April for camera modules and other components for iPhone assembly in summer months, former employees said.
The report says Apple CEO Tim Cook is staying in touch with employees via email on a regular basis, noting that Apple is “prepared for this moment and will continue to invest in the future.”
However, the report also sources one analyst that points out the obvious bit of information that unsold iPhones or unused components could eat into Apple’s profit margins.
Being stuck with extra modems or unsold 5G iPhones could cut into the rich profit margins that helped make Apple the first U.S. company valued at $1 trillion, said Mehdi Hosseini, an analyst with Susquehanna International Group. He expects Apple to have component suppliers continue making iPhone parts as planned while it reassesses demand in May or June.
The Wall Street Journal says Apple is “scrambling” to prevent COVID-19-related product delays. For example, the report mentions how Apple’s engineering teams, who are banned from traveling to China and are instead communicating about iPhone prototype assembly with their Chinese counterparts via video calls.
Apple is allowing hardware engineers to take home prototypes of unreleased products they’re working on for the first time.
(Via 9to5Mac)