Apple slashes iPad production in half, reroutes chips to iPhones: report

By: Theo W.

Apple has reportedly slashed iPad production in half and is shifting components from older iPhone models to the iPhone 13 as the tech giant seeks to weather a global chip shortage that has already wiped out more than $6 billion in revenue.

The company made the production changes in September and October in order to ensure a smooth rollout for the iPhone 13, Nikkei Asia reported on Tuesday.

The news comes just days after Apple CEO Tim Cook told investors that supply chain woes including the chip shortage wiped out more than $6 billion in revenue during the July-through-September fiscal quarter.

“We’re doing everything we can do to get more [chips] and also everything we can do operationally to make sure we’re moving just as fast as possible,” Cook said Thursday, adding that he expects the chip crunch to be even worse through the end of 2021.

Apple did not immediately reply to a request for comment on the Nikkei report, which cited sources familiar with the matter.

The news comes as Apple customers have been seeing longer-than-usual wait times for Apple products, including new iPhones and iPads the company revealed in September.

iPads ordered through Apple’s site on Tuesday would not be expected to arrive to a New York City address until the first week of December, according to Apple’s site. New iPhone 13 Pro models would not be delivered until at least Nov. 24, the site shows.

The iPhone is Apple’s most lucrative product and typically sells best during the holiday season, so it makes sense for Apple to give the phones priority over tablets, according to Wedbush Securities managing director Dan Ives.