Apple shares rose almost 3% Thursday as the tech giant and its manufacturing partners have worked to improve the supply of its all-important iPhone.
The manufacturing plant for Foxconn, also known as Hon Hai Precision, in Zhengzhou, China, is now said to be operating at roughly 70% of its capacity levels as China has eased up on it more of its COVID-19 restrictions.
According to the Wall Street Journal, analysts and officials close to Foxconn’s supply chain confirmed the company has cranked up it production lines.
Foxconn started offering bonuses in November to help boost employment at its Zhengzhou plant, sometimes known as “iPhone city,” in an effort to increase production. The Journal added that Foxconn has started to offer the bonus equivalent of roughly $700 to manufacturing workers who stay on the line through March 20.
Foxconn dealt with worker unrest last month and earlier this month as a result of COVID-19 restrictions placed on it by Chinese government officials and unpaid bonuses. Foxconn ended the “closed-loop” system that had been in place at its Zhengzhou plant and apologized for the unpaid bonuses, but it is still struggling to boost production levels and raise employment, The Journal added.
Earlier this week, J.P. Morgan analyst Samik Chatterjee wrote that iPhone supply was “improving and inching slowly toward parity with demand.”
Thursday’s share gains helped Apple (AAPL) bounce back from dropping to a 52-week-low on Wednesday.
On Wednesday, research firm Trendforce cut its shipment forecast to 78.1M iPhone 14 units for 2022, down from a previous estimate, citing continued labor shortages at Foxconn’s main production facility in Zhengzhou, China. SeekingAlpha