Apple Analyst Sees iPhone Sales Tanking 20% On Black Friday Weekend As Production Hit — Woes Could Last Through Christmas

Zinger Key Points
  • The December quarter is Apple's seasonally strong quarter, when it sells a majority of its hardware products.
  • This time around, Apple is facing a serious supply issue as China lockdowns hurt the iPhone plant of its key supplier.

Apple Inc.’s AAPL newest iPhone iteration will be in short supply for the Black Friday holiday weekend, an analyst at Wedbush said.

The Apple Analyst: Daniel Ives has an Outperform rating and $200 price target for Apple shares.

The Apple Thesis: The iPhone 14 demand is way ahead of supply, potentially causing major shortages leading into the Christmas season, Ives said in a note. The COVID-19 China shutdowns at Apple supplier Hon Hai Precision Manufacturing Company Limited HNHPF have been a “gut punch” to Apple in the December quarter, the analyst said.

This has taken roughly 5% of iPhone 14 units out of the supply chain, he added.

See Also: Apple Has 3 Massive Growth Opportunities With 'Another Decade Of Solid Performance,' Analyst Says

The analyst expects Black Friday weekend iPhone sales to be at about eight million units, down from 10 million in the year-ago period, with the gap mostly supply-driven.

"We believe by early December it will be increasingly difficult to get your hands on an iPhone 14 Pro with many delivery times likely pushed through to early January," Ives said.

If the Zhengzhou plant of Hon Hai, aka Foxconn, remains at lower capacity over the next few weeks and continues to see worker unrest build, clear major iPhone Pro shortages could result in the all-important Christmas period, especially in the U.S., he said.

The Zhengzhou situation in China remains an ongoing albatross for Apple, Ives said. The analyst, however, said his positive thesis on the demand story for Apple remains unchanged. He added that he would be a buyer of the name with the demand thesis holding firm in this economic storm.

Price Action: In premarket trading on Wednesday, Apple shares were down 0.21% at $149.87, according to Benzinga Pro data.

Read Next: How To Buy Apple (AAPL) Stock

Market News and Data brought to you by Benzinga APIs
Price Target
Posted In: Analyst ColorNewsReiterationTop StoriesAnalyst RatingsTechBlack friday salesChinaChristmasCovid-19Daniel IvesfoxconniPhoneWedbush
Benzinga simplifies the market for smarter investing

Trade confidently with insights and alerts from analyst ratings, free reports and breaking news that affects the stocks you care about.

Join Now: Free!