Apple will make about 20% fewer iPhone SEs next quarter than the tech giant had originally planned, a sign that consumer electronics demand has been lowered as the Russian attacks on Ukraine continue and escalating fears about global wars persist, according to a Nikkei Asia report Monday (March 28).
Apple launched the 2022 edition of the iPhone SE, a more affordable 5G-capable phone, less than three weeks ago, but is scaling back production by 2 to 3 million this quarter, four people told Nikkei Asia for its report. The company will also cut back on AirPods earphones production by 10 million units for 2022.
The tech giant shipped about 76.8 million AirPods last year. That number is likely to drop in 2022.
Finally, Apple also has asked its suppliers to slow down iPhone 13 production by a couple of million units across the entire range, based on seasonal demand.
The Russia-Ukraine war has put a further crimp on the shortage of chips for electronics that have hurt the production of everything from smartphones to PCs to automobiles. Several countries have imposed sanctions on Russia during the ongoing conflict, leading to higher prices and lower supply on some items.
Apple ended its sales in Russia shortly after their military attacked Ukraine. Apple is the third-biggest smartphone maker in Russia. The country saw sales of about 5 million iPhones last year.
Related: Apple Developing iPhone Hardware Subscription Service
Last week, Apple Inc. announced a subscription service for the iPhone and its other hardware products that would allow people pay for their devices with a monthly fee, similar to app fees, saying they are still in development.
Apple has typically used installments or carrier subsidies to sell its devices at full cost, but the shift to a subscription model could help the tech giant generate more revenue and make it easier for people to afford their gadgets.
The iPhone generated almost $192 billion in sales last year, more than half the company’s revenue, Bloomberg reported. An Apple spokeswoman declined to comment on the company’s plans.
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