High-end iPhones will be scarce in stores this holiday season after a warning from Apple Inc.
High-end iPhones will be scarce in stores this holiday season, Best Buy Co Inc said Tuesday, following a warning from Apple Inc this month that China’s zero-COVID policy was straining production at a key factory.
The delivery issues are expected to significantly hurt the premium iPhone 14 Pro and iPhone 14 Pro Max models, which start at nearly $1,000.
“One of the places where we see a little bit of (stock) pressure is in those more expensive iconic iPhone devices,” said Best Buy boss Corie Barry during a media call.
Not sure which one
Analysts have indicated that stocks of iPhones in Apple stores around the Black Friday shopping season were lower than a year earlier, and stocks were taking longer to replenish.
iPhones attract customers to Best Buy stores, especially during the holiday season, often leading to impulse purchases, and Apple fans waiting for the latest devices can push sales into the next quarter.
A Best Buy store in Bronx, New York, that Reuters visited had no iPhone Pro models available. A store supervisor, Michael Phillips, said it takes at least two weeks for models to arrive after orders are placed.
“We’re losing a lot of customers because of that,” Phillips said. For people who want the Pro Max, “you don’t settle for something that doesn’t have the specs you want.”
Best Buy did not respond to a request for comment.
The demand for high-end smartphones has helped Apple emerge relatively unscathed, even as consumers cut spending amid rising inflation and interest rates.
“With consumers, we also see that savings are being written off and credit use is increasing,” says Barry. “Value is clearly important to everyone.”
Wedbush analyst Dan Ives estimates that 8 million iPhone 14 units will be sold over the Black Friday weekend, about 2 million fewer than iPhone 13s a year ago, as many Apple stores stock 25% fewer iPhones than a years earlier.
“Sales of iPhones may be pushed into the March quarter and out of the December period,” said Thomas Forte, an analyst at DA Davidson.
Earlier this month, Apple warned of shipping delays for its flagship product following a significant production cut at Foxconn’s factory in Zhengzhou due to China’s strict COVID-19 policies.
Apple did not respond to a request for comment on this story.
Best Buy’s Barry said the company factored in the expected loss of sales due to the shortage of premium iPhones in its holiday quarter forecast.
Still, Best Buy predicted a smaller drop in annual sales on Tuesday than previously estimated.