Apple reportedly cuts back production of iPhone SE 3 (2022) and AirPods

Apple just started selling the new third-generation iPhone SE, which packs the same Apple A15 Bionic chipset from the iPhone 13 series into a $430 smartphone. However, Apple is reportedly cutting back production for the new phone, and the company will sell fewer AirPods this year than originally planned.

Nikkei Asia is reporting that Apple plans to manufacture about 20% fewer iPhone SE units next quarter than originally planned, according to sources briefed on the matter — around 2-3 million units in total. Apple has also reportedly decreased its 2022 manufacturing orders for AirPods by more than 10 million units. The lower manufacturing orders for those devices is due to lower demand from buyers, but the reason for that lower demand is likely a mix of factors. The United States reached a four-decade high for inflation in February, which has has continued throughout March and has likely resulted in many people holding off on new electronics purchases.

Apple is probably dealing with supply-side problems, as well — Ukraine and Russia both export a high amount of nickel, platinum, rhodium, and titanium, which are critical for semiconductor manufacturing. Russia’s global exports have been limited due to sanctions from its ongoing invasion of Ukraine, and Ukraine is (understandably) having a difficult time maintaining trade while it is being invaded.

It’s also possible the third-generation iPhone SE simply isn’t as popular as Apple had hoped for. The new model is an impressive package for $430, as we noted in our review, but the $30 price increase over the previous generation and the same older design are definite drawbacks to most people.

The war in Ukraine has caused other ripple effects in the tech industry. Some companies have ended operations in Russia on their own volition, while others have left or partially left the country due to global banking restrictions. Google, Apple, Microsoft, and other companies have limited their operations in Russia over the past month.

Source: Nikkei Asia
Via: Reuters

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