Kuo: iPhone 14 Pro Sales Are in Big Trouble Due to Foxconn Factory Protests
iPhone 14 Pro and iPhone 14 Pro Max shipments in the fourth quarter of 2022 will be "significantly lower" than the market consensus due to labor protests at Foxconn's main iPhone factory in China, according to analyst Ming-Chi Kuo.
Kuo today said iPhone production at the factory in Zhengzhou has been "significantly affected" by the protests over unfavorable working conditions, leading him to cut his iPhone shipments forecast for the fourth quarter of 2022 by 20% to 70-75 million units, compared to a market consensus of 80-85 million units.
The average capacity utilization rate at the factory was only about 20% in November, and is only expected to improve to 30–40% in December, according to Kuo. He said Pegatron and Luxshare have each obtained about 10% of iPhone 14 Pro and 14 Pro Max orders from Foxconn, but said mass shipments will not be until late December at the earliest.
Kuo believes that the production issues could result in iPhone revenue being "significantly lower than the market consensus by 20–30% or more" this quarter.
Due to lengthy shipping delays and a recession, Kuo believes that most of the demand for iPhone 14 Pro models this quarter will simply "disappear" rather than be deferred, suggesting that many customers who would have purchased an iPhone 14 Pro right now will not return to order the device in January or later once supply improves.
iPhone 14 Pro models currently face at least a four-week shipping delay on Apple's online store in the U.S. as the company struggles to maintain supply.
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