Apple iPhone maker Foxconn reports a sharp drop in sales amid unrest and Covid cases at its massive Chinese factory

Hon Hai Precision Industry — better known as Foxconn — reported that November sales fell 11.4 percent year-on-year after some shipments were hit by a Covid outbreak in the Chinese city of Zhengzhou, where the company has the world’s largest Operates iPhone assembly complex.

oxconn said November was the period hardest hit by the pandemic and expects the fourth quarter to be “roughly in line with market consensus.”

The Covid outbreak led to government lockdowns, exodus of workers and violent protests at the manufacturing plant.

The Zhengzhou campus in central China assembles the bulk of the world’s iPhone Pro phones, which is critical to Apple’s ability to meet demand for the latest generation.

Apple has announced shipments will be delayed this year due to disruptions, and analysts have issued a series of increasingly pessimistic forecasts for this year’s shipment disruptions.

UBS said this month that the full iPhone 14 generation could fall 16 million units short of previous expectations.

Hon Hai shares slid as much as 2.4 percent in Taiwan trading on Tuesday, its biggest one-day drop since October, while shares of Apple in the U.S. fell less than 1 percent.

Foxconn assured that the situation was “put under control” and that production will improve by the end of the year.

“In addition to redistributing production capacity from various factories, we have also started hiring new employees and are gradually moving towards restoring normal production capacity,” Foxconn said in the statement.

China is lifting Covid restrictions in some cities, including Zhengzhou, where authorities on Sunday announced the immediate end of mandatory Covid testing for boarding buses, subways, taxis and other public facilities, except for those who do Get out of town or go to karaoke bars and internet cafes.

According to a notice published on WeChat, Foxconn is continuing the closed loop, restricting workers’ movements to their dormitories and the factory.

“China’s easing of the Covid-zero policy could help lift Hon Hai’s December sales and pave the way for it to meet or even beat fourth-quarter guidance,” said Bloomberg Intelligence analysts Steven Tseng and Sean Chen on Monday.

https://www.independent.ie/business/world/apple-iphone-maker-foxconn-reports-sharp-sales-drop-amid-unrest-and-covid-fallout-at-its-huge-chinese-factory-42206464.html Apple iPhone maker Foxconn reports a sharp drop in sales amid unrest and Covid cases at its massive Chinese factory

Fry Electronics Team

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