Apple Targets 20% Increase in iPhone Production for 2021 – Report

Apple (AAPL) is expected to launch its 2021 iPhone models in September as opposed to last year’s October launch, as the supply chain recovers, according to a Bloomberg report. The global chip shortage is not expected to affect iPhone production.

Apple anticipates strong demand for its new iPhones. It has asked its suppliers to produce as many as 90 million units of the 2021 iPhones, Bloomberg reports. That would represent a 20% increase from about 75 million units produced in recent years. The upcoming models will be the first new iPhones to hit the market since the COVID-19 vaccine rollout began. (See Apple stock charts on TipRanks).

Apple’s 2021 iPhone models are expected to come with an improved processor, display, and camera. The camera upgrade is expected to focus more on video recording features and a possible reduction in the size of the front-facing camera. Some models may include technology that improves power efficiency. 

In addition to feature improvements potentially driving increased demand, Apple’s larger initial shipment order may also be in the hope of benefiting from Huawei’s woes in the smartphone market, according to the report.

On Monday, Bank of America analyst Wamsi Mohan reiterated a Hold rating on Apple stock with a price target of $160. Mohan’s price target suggests 9.86% upside potential. The analyst noted a slowdown in Apple’s App Store growth. App Store revenue grew about 17% year-over-year in June 2021, marking a sharp deceleration from 37% growth in June 2020.

Consensus among analysts is a Moderate Buy based on 20 Buys, 5 Holds, and 2 Sells. The average Apple price target of $158.27 implies 8.67% upside potential to current levels.

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