(Reuters) – Apple Inc’s victory over the global chip shortage in its supply chain has sparked some good news amid troubled markets around the world. Not so fast, analysts say.
The iPhone maker, which had warned three months ago that delivery problems would hurt its holiday-quarter earnings, posted record results on Thursday, largely boosted by sales of its premium phones. It sees an improvement in the situation, if there are still some shortages.
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“Most supply issues are over for Apple, but not necessarily for everyone else,” said Bob O’Donnell, principal analyst at TECHnalysis Research.
Companies from electric car maker Tesla Inc to wafer manufacturing equipment supplier Lam Research have again warned that supply chain problems, which crippled several industries, would continue to limit production this year.
Semiconductor companies tend to prioritize bigger players like Apple, due to its massive purchasing power, massive demand for its products, and the company’s ability to place custom orders for components used in its products. And Apple’s high-end chips are expensive, an attraction for the chip makers.
Essentially, this means that Apple has an advantage and can purchase components relatively faster than competitors.
While Apple, like many others, was getting better service for more advanced chips, it had issues with some of the older technology chips, said Lou Miscioscia, an analyst for Daiwa Capital Markets.
Chips used in Apple iPads, which saw a 14% drop in sales, use chips with older technology, and supply of those older chips has been particularly tight, Apple Chief Executive Tim Cook told analysts.
Cook said the restrictions on the older chips, or nodes, were very important in the holiday quarter. “Overall, we see an improvement in the March quarter in terms of diminishing restrictions from what they were in the December quarter,” he said.
Tesla CEO Elon Musk said this week that supply chain problems would limit production at all of the company’s factories. “So the chip shortage, although better than last year, is still an issue,” he told analysts.
Lam Research, a semiconductor device manufacturer, noted new supply challenges, with the Omicron spike adding to the disruption of freight and logistics operations. The company said it saw shortages of certain components and parts, including semiconductors, for a few weeks into 2022.
Analysts and industry leaders in the semiconductor industry hoped that the supply problems would ease later this year.
“That remains an industry concern, but Apple may be the exception to the rule,” said Romeo Alvarez, technology analyst at William O’Neil + Co.
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