The Chip Shortage’s Impact on Apple and Tesla
Apple and Tesla Warn of Product Delays
Apple (AAPL) and Tesla (TSLA) both posted strong revenue for their second quarters, but the semiconductor shortage could stunt that growth in the near future. When reporting quarterly earnings earlier this week, both companies warned that chip shortages will cause supply-chain difficulties for key products.
Industries across the world have been dealing with semiconductor shortages for months, which has wreaked havoc on the global economy. Many automobile makers canceled chip orders during the pandemic and then were unable to access more chips when demand for cars picked up. This chain of events has driven up prices for the limited supply of new vehicles available. As the chip shortage continues, other industries besides car companies are also feeling squeezed.
Apple’s Chip Challenges
When reporting earnings, Apple said that chip shortages would impact its smartphone business in the coming quarter. The warning comes as Apple is gearing up to launch as many as four new iPhone models this fall.
This marks the first time that supply-chain constraints have harmed Apple’s iPhone business. The tech giant warned in April that its iPads and Mac computers could be negatively impacted by the chip shortage, with the possibility of losing $3 billion to $4 billion in sales. The reality wasn’t as bad as many had feared. Apple’s revenue hit was less than $3 billion thanks to mitigation efforts, but now chip shortages could affect all three of the company’s flagship products. This is resulting in slower growth forecasts.
Could Cybertruck Production Get Delayed?
Tesla also had a strong quarter, posting a record profit. The company also shared that demand doubled on a year-over-year basis. To deal with chip shortages, the EV maker found new chip sources and rewrote code to make them work in its vehicles. Those efforts paid off during the second quarter.
Chip shortages could now impact the rollout of Tesla’s Cybertruck, a highly anticipated pickup truck model. Production of the Cybertruck is scheduled to begin later in 2021. But during the company’s earnings conference call earlier this week, Tesla said production could be delayed as a result of chip supply constraints.
Apple and Tesla have been able to weather the global chip shortage relatively unscathed, but it may be catching up to them. It will be interesting to see how both companies respond in the coming months.
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