April 13, 2024
Apple Stopped M2 Chip Production in January Due to Plummeting MacBook Sales [Report]

Apple Stopped M2 Chip Production in January Due to Plummeting MacBook Sales [Report]

Posted April 3, 2023 at 2:30pm by iClarified
Apple stopped production of its M2 chip for MacBooks in January and February due to plummeting sales, according to a new report from The Elec. This is purportedly the first time Apple has stopped producing chips. Some production resumed last March but only at half the level of the previous year.

The stop in production is blamed on a weak PC market...

According to the Outsourcing Semiconductor Package Test (OSAT) industry on the 3rd, Taiwan's TSMC did not send 5-nano process M2 chip wafer processing products to OSAT in January and February. It is believed that this is because Apple requested a halt to production as demand for the MacBook decreased. The M2 chip is finally processed through a general flip chip packaging process, unlike the A-series chips in the fan-out wafer-level package (FO-WLP) package method, which TSMC calls InFO (Integrated Fan Out). When TSMC completes the entire process, it will send the processed wafers to Amkor or Stats Chippack's Korean factories for packaging. This stock did not exist in January or February. Although wafers have been coming in since March, an official familiar with the matter said that it was only half of the previous year.

Apple's halt in production also affected various parts manufacturers who supplied components for the M2. The Elec reports that solder balls are supplied by Accuracy in Taiwan. Thermal Interface Material is supplied by Wacker of Germany. Underfill is supplied by Namix of Japan. Package lid (lead) is supplied by Youngil Precision in Korea. Adhesive material is supplied by Henkel of Germany.

Notably, Tim Cook addressed the challenging PC market in the company's last earnings call.

The industry is very challenged, as you say. The industry is contracting. I think from us though, and I don't know how this year will play out so I don't want to predict the year, but over the long run we have a market that is a reasonable sized market, a big market, and we have low share and we have a competitive advantage with Apple silicon. And so strategically I think we're well positioned in the market, albeit I think it will be a little rough in the short term.

Despite the PC market slowdown, Apple's M2 MacBook Air remains a solid buy. It's currently on sale for just $1049, down from $1199.

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Apple Stopped M2 Chip Production in January Due to Plummeting MacBook Sales [Report]
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