iPhone 12 production could be hampered with reports that Apple is facing a shortage of a vital chip that manages power consumption.
Following a delayed launch of the iPhone 12 range due to production issues caused by the Covid-19 pandemic, Apple may now be facing another obstacle in the production of its flagship devices. According to Bloomberg, sources familiar with Apple production said the company is facing a shortage of a power chip that is important for facilitating 5G and new camera features.
They added that the cause of the production bottleneck is the result of increasing demand for silicon and, once again, disruption caused by the pandemic. Furthermore, any potential disruptions could last over the next two financial quarters, they claimed.
While it is still unknown what the impact will be in the run up to Christmas, it’s believed that suppliers will still prioritise Apple and the iPhone 12 over other customers looking to acquire the in-demand parts.
Supply issues ‘not a surprise’
Apple’s major chip supplier, Taiwan Semiconductor Manufacturing Company, had previously said that 5G phones require up to 40pc more chip content compared with a 4G device. This, along with the uncertainty caused by the pandemic, has resulted in phone manufacturers buying large quantities of chips to offset any future shortages.
While not specifying power-management chips, Apple CEO Tim Cook said during the company’s recent earnings call that chip supply issues were “not a surprise” given the company is ramping up production of the iPhone 12 to meet demand and that it’s “hard to predict” future disruption.
When asked about the potential disruption caused by a shortage of power-management chips, Apple declined to comment to Bloomberg. The company uses a number of suppliers for this type of chip, including Qualcomm and Texas Instruments.
The tech giant recently reported a record-setting fourth quarter with revenues of $64.7bn. However, as production delays meant the iPhone 12 launch fell outside of Apple’s 2020 fiscal year, it resulted in the steepest quarterly drop in iPhone sales in two years, down 20.7pc to $26.4bn.