Apple Faces Supply Uncertainty for Foldable iPhone Following Rapid Sell-Out

Apple is currently navigating significant supply chain hurdles as it works to restock its newly released foldable smartphone, the iPhone Duo. Following its launch just over a week ago, the $1,999 device—which also retails for £1,999 in the UK—quickly sold out, leaving the company unable to provide a firm timeline for when additional inventory will reach the Apple store. John Ternus, who assumed the role of chief executive in September, expressed enthusiasm regarding the initial consumer reception of the device.

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Despite the strong demand, the product rollout has not been without complications. While company executives did not address specific hardware concerns during a recent financial call, Apple previously acknowledged that a small number of units experienced screen cracking along the inside fold and pledged to replace those devices. Chief Operating Officer Sabhi Kahn noted that predicting when supply will align with demand remains difficult, as the technology giant continues to grapple with broader production constraints.

Apple is struggling to meet high demand for its new foldable iPhone Duo due to ongoing supply constraints.

These manufacturing challenges are largely attributed to a global shortage of microprocessors with advanced nodes, which are essential for the high-speed performance of Apple hardware. Much of this chip production is handled by TSMC in Taiwan. Furthermore, the company is facing unprecedented cost increases for memory storage, driven by a surge in demand from data centers supporting artificial intelligence platforms. To offset these rising expenses, Apple has increased prices across its hardware lineup by approximately 20%.

Despite these supply-side pressures, Apple reported record-breaking annual performance. Global iPhone sales reached an all-time high over the past year, with a 17% increase to $57bn during the quarter ending September 26. Mac computer sales also hit a record $10.7bn, marking a 27% growth. However, the company saw a decline in other segments, with iPad sales falling by 10% and wearable products, including the Apple Watch and headphones, dropping by 7%. Executives warned that supply constraints, particularly for iPads and Macs, are expected to persist into the coming year, exacerbated by unexpectedly high demand for the company’s latest offerings.

Why it matters

The supply shortage for the iPhone Duo highlights the ongoing vulnerability of global tech supply chains to component scarcity and rising memory costs. This situation impacts consumers worldwide, including those in India and South Asia, who may face prolonged wait times for premium devices. The broader price increases across Apple's hardware portfolio reflect the company's struggle to balance record demand with the escalating costs of advanced manufacturing.