Apple Could Be Short of iPhones Because of Factory Disruptions in China

The company said Covid-19 restrictions were slowing production of the companys new phones ahead of the holiday season.

Weeks after expressing optimism about the global economy and its business, Apple on Sunday warned that its sales would fall short of expectations because a key iPhone factory in China had been shut down by a coronavirus outbreak.

The abrupt change in its business prospects are the latest reminder of the risks of the companys concentrated manufacturing supply chain in China. Once an operational strength that afforded Apple the flexibility to have legions of workers crank out iPhones to meet global demand, its reliance on China has become a liability as the countrys commitment to a zero Covid-19 policy has led it to lock down cities, businesses and factories.

In mid-October, Apples largest iPhone manufacturer, Foxconn, shut off the primary plant in Zhengzhou as coronavirus cases spiked. Foxconn closed the facility to the outside world and walled roughly 200,000 workers inside its grounds. Production of iPhones has continued at a significantly reduced capacity, Apple said in a statement on Sunday. The company added that its production woes would mean that customers would face longer wait times between the purchase and delivery of its high-end iPhone 14 Pro and 14 Pro Max.