April 6, 2023
Apple’s M2 chip has not been able to entice enough customers to buy them, resulting in Apple having to scale back production and pause it entirely for two months to match the lower demand.
Reports indicate that Apple’s third-party suppliers and vendors have also felt the pinch as a result. Although Apple has not said anything publicly about the chip production halt, The Elec is reporting that other suppliers in the chain were able to provide information and numbers showing the chip pause during those months.
These are mostly firms that perform post-fabrication work on the wafers from TSMC before they’re installed in Macs at other assemblers. For at least a few of the firms that The Elec spoke to, they had not received any M2 wafers from TSMC in January or February. One supplier, Amcona, was apparently badly hit by the pause, as it has a line completely dedicated to Apple chip packaging that sat idle for two months.
The reason behind the M2 chip production halt is not official. However, in Apple’s Q1 2023 earnings report, the company confirmed that Mac revenue declined dramatically late last year, which may have led to the decline in demand for the M2 chip.
Apple’s CEO, Tim Cook, stated that these revenue figures were in line with expectations, but if the roughly 30% decline in Mac sales was expected, there shouldn’t have been a pause in chip production, as the company would have anticipated the number of chips it needed earlier and ordered fewer wafers with TSMC as a result.
One possible reason for slower sales of Apple’s latest Macs may be the market saturation created by the M1 lineup, including the M1 Pro and M1 Max MacBook Pro models, in addition to the M1 MacBook Air. If there were any fence-sitters who were still on older Intel-based Macs, they would have made the jump when the M1 chip was launched, and the M2 chips, despite being excellent SoCs, aren’t that much better than the M1-series chips they are replacing.
The M2 chip’s lack of excitement may also affect the launch of the new iMac (2023) with a new 3nm M3 chip later this year. Reports suggest that the M2 chip isn’t generating the kind of excitement that the M1 chips did back in 2020 and 2021, which makes the possibility of a new iMac with an M3 chip more likely.
The sources for this piece include an article in TechRadar.
