Apple 'always looking at supply chain tweaks'

Will Green is news editor of Supply Management
1 May 2020

Apple CEO Tim Cook has said the company will look to see what supply chain lessons can be learned from the coronavirus outbreak.

During a call with analysts, Cook said he “felt good” about how the supply chain had responded to the challenges produced by the pandemic, but Apple was “always looking at tweaks”.

Cook said there were “temporary supply chain constraints” in February, with iPhone supply affected, but “production was back at typical levels towards the end of March”.

“If you look at the shock to the supply chain that took place this quarter, for it to come back up so quickly demonstrates its durability and resilience,” he said.

“I feel good about where we are. That said, we are always looking at tweaks. It’s just not something we talk about because we view it as confidential and competitive information.

“As we get out of this we will look to see what we learned and what should change.”

Apple reported revenues of $58.3bn for the second quarter of its financial year, up 1% year-on-year, with profits before tax of $13.1bn, down 4.7%.

Meanwhile, Amazon reported sales increased 26% year-on-year to $75.5bn in the first quarter of its financial year, while operating income dropped to $4bn, down 9%.

Founder and CEO Jeff Bezos said:  “Under normal circumstances, in this coming Q2, we’d expect to make some $4 billion or more in operating profit. But these aren’t normal circumstances.

“Instead, we expect to spend the entirety of that $4 billion, and perhaps a bit more, on Covid-related expenses getting products to customers and keeping employees safe. This includes investments in personal protective equipment, enhanced cleaning of our facilities, less efficient process paths that better allow for effective social distancing, higher wages for hourly teams, and hundreds of millions to develop our own Covid-19 testing capabilities.

“There is a lot of uncertainty in the world right now, and the best investment we can make is in the safety and well-being of our hundreds of thousands of employees.” 

Amazon said a team including scientists and procurement specialists was working to build a lab to test employees for coronavirus.

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