Apple, Others Face Shipment Delays as China COVID Curbs Squeeze Suppliers, Say Analysts

A customers holds the new green color Apple iPhone 13 pro shortly after it went on sale inside the Apple Store on 5th Avenue in Manhattan in New York City, New York, US, March 18, 2022. (Reuters)
A customers holds the new green color Apple iPhone 13 pro shortly after it went on sale inside the Apple Store on 5th Avenue in Manhattan in New York City, New York, US, March 18, 2022. (Reuters)
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Apple, Others Face Shipment Delays as China COVID Curbs Squeeze Suppliers, Say Analysts

A customers holds the new green color Apple iPhone 13 pro shortly after it went on sale inside the Apple Store on 5th Avenue in Manhattan in New York City, New York, US, March 18, 2022. (Reuters)
A customers holds the new green color Apple iPhone 13 pro shortly after it went on sale inside the Apple Store on 5th Avenue in Manhattan in New York City, New York, US, March 18, 2022. (Reuters)

Shipments of some Apple products, as well as Dell and Lenovo laptops are likely to face delays if China's COVID-19 lockdowns persist, analysts said, as curbs force assemblers to shut down and closed-loop arrangements get harder to maintain.

China's race to stop the spread of COVID-19 has jammed highways and ports, stranded workers and left countless factories awaiting government approval to reopen - disruptions that are rippling through global supply chains.

Apple Inc supplier Pegatron Corp said this week it would suspend its plants in Shanghai and Kunshan, where according to supply chain experts it produces the iPhone 13, the iPhone SE series, and other legacy models.

Quanta Computer Inc, which produces some three-quarters of Apple's Macbooks globally, also shut operations, which could impact delivers more severely, analysts said.

The final impact on Apple's supply chain is uncertain and depends on factors including how long lockdowns persist.

The company may also consider re-routing production out of Shanghai and Kunshan to factories elsewhere, such as Shenzhen, which currently is not under lockdown, analysts said.

"Apple may consider transferring the orders from Pegatron to Foxconn, but we expect the volume may be limited due to the logistics issue and the difficulty of equipment adjustment," said Taipei-based Eddie Han, a senior analyst at Isaiah Research. Foxconn is the trade name of Hon Hai Precision Industry Co Ltd .

As a worst-case scenario, Pegatron may fall behind on 6 million to 10 million iPhone units if the lockdowns last two months and Apple cannot reroute orders, Han said.

Apple did not respond to a request for comment.

The chief executives of Huawei Technologies Co Ltd and Xpeng Inc have flagged huge economic costs if factories in Shanghai cannot resume production soon.

Shanghai is approaching its third week of lockdown and has shown no sign of a wide re-opening.

Forrest Chen, research manager at Trendforce told Reuters that if lockdowns lift in a few weeks, there is still a chance to recover.

However, "if the lockdown lasts longer than two months, there is already no way to recover. At that point, after lockdown lifts, there would be a shortage for end-users," he said.

Some suppliers may be able to re-route production.

Unimicron Technology Corp, which makes printed circuit boards for companies including Apple, told Reuters the impact of the Kunshan lockdown so far has been minor and that it can rely on other plants in the Hubei province and Taiwan to support production.

But logistics and transport remain a nationwide issue, as cities across China enact measures.

One factory owner in Kunshan told Reuters that the district government had announced protocol for re-opening but provided no date for implementation.

Laptop makers may also suffer, including Compal Electronics Inc, a Taiwan-based company that makes PCs for Dell Technologies Inc and Lenovo Group Ltd from its plants in Kunshan. Chen estimates that roughly 50% of Compal's laptop production is located in Kunshan.

Compal told Reuters on Friday that it had not halted production in Kunshan. Dell and Lenovo did not respond to emails seeking comment.



Siemens Energy Trebles Profit as AI Boosts Power Demand

FILED - 05 August 2025, Berlin: The "Siemens Energy" logo can be seen in the entrance area of the company. Photo: Britta Pedersen/dpa
FILED - 05 August 2025, Berlin: The "Siemens Energy" logo can be seen in the entrance area of the company. Photo: Britta Pedersen/dpa
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Siemens Energy Trebles Profit as AI Boosts Power Demand

FILED - 05 August 2025, Berlin: The "Siemens Energy" logo can be seen in the entrance area of the company. Photo: Britta Pedersen/dpa
FILED - 05 August 2025, Berlin: The "Siemens Energy" logo can be seen in the entrance area of the company. Photo: Britta Pedersen/dpa

German turbine maker Siemens Energy said Wednesday that its quarterly profits had almost tripled as the firm gains from surging demand for electricity driven by the artificial intelligence boom.

The company's gas turbines are used to generate electricity for data centers that provide computing power for AI, and have been in hot demand as US tech giants like OpenAI and Meta rapidly build more of the sites.

Net profit in the group's fiscal first quarter, to end-December, climbed to 746 million euros ($889 million) from 252 million euros a year earlier.

Orders -- an indicator of future sales -- increased by a third to 17.6 billion euros.

The company's shares rose over five percent in Frankfurt trading, putting the stock up about a quarter since the start of the year and making it the best performer to date in Germany's blue-chip DAX index.

"Siemens Energy ticked all of the major boxes that investors were looking for with these results," Morgan Stanley analysts wrote in a note, adding that the company's gas turbine orders were "exceptionally strong".

US data center electricity consumption is projected to more than triple by 2035, according to the International Energy Agency, and already accounts for six to eight percent of US electricity use.

Asked about rising orders on an earnings call, Siemens Energy CEO Christian Bruch said he thought the first-quarter figures were not "particularly strong" and that further growth could be expected.

"Demand for gas turbines is extremely high," he said. "We're talking about 2029 and 2030 for delivery dates."

Siemens Energy, spun out of the broader Siemens group in 2020, said last week that it would spend $1 billion expanding its US operations, including a new equipment plant in Mississippi as part of wider plans that would create 1,500 jobs.

Its shares have increased over tenfold since 2023, when the German government had to provide the firm with credit guarantees after quality problems at its wind-turbine unit.


Instagram Boss to Testify at Social Media Addiction Trial 

The Instagram app icon is seen on a smartphone in this illustration taken October 27, 2025. (Reuters)
The Instagram app icon is seen on a smartphone in this illustration taken October 27, 2025. (Reuters)
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Instagram Boss to Testify at Social Media Addiction Trial 

The Instagram app icon is seen on a smartphone in this illustration taken October 27, 2025. (Reuters)
The Instagram app icon is seen on a smartphone in this illustration taken October 27, 2025. (Reuters)

Instagram chief Adam Mosseri is to be called to testify Wednesday in a Los Angeles courtroom by lawyers out to prove social media is dangerously addictive by design to young, vulnerable minds.

YouTube and Meta -- the parent company of Instagram and Facebook -- are defendants in a blockbuster trial that could set a legal precedent regarding whether social media giants deliberately designed their platforms to be addictive to children.

Rival lawyers made opening remarks to jurors this week, with an attorney for YouTube insisting that the Google-owned video platform was neither intentionally addictive nor technically social media.

"It's not social media addiction when it's not social media and it's not addiction," YouTube lawyer Luis Li told the 12 jurors during his opening remarks.

The civil trial in California state court centers on allegations that a 20-year-old woman, identified as Kaley G.M., suffered severe mental harm after becoming addicted to social media as a child.

She started using YouTube at six and joined Instagram at 11, before moving on to Snapchat and TikTok two or three years later.

The plaintiff "is not addicted to YouTube. You can listen to her own words -- she said so, her doctor said so, her father said so," Li said, citing evidence he said would be detailed at trial.

Li's opening arguments followed remarks on Monday from lawyers for the plaintiffs and co-defendant Meta.

On Monday, the plaintiffs' attorney Mark Lanier told the jury YouTube and Meta both engineer addiction in young people's brains to gain users and profits.

"This case is about two of the richest corporations in history who have engineered addiction in children's brains," Lanier said.

"They don't only build apps; they build traps."

But Li told the six men and six women on the jury that he did not recognize the description of YouTube put forth by the other side and tried to draw a clear line between YouTube's widely popular video app and social media platforms like Instagram or TikTok.

YouTube is selling "the ability to watch something essentially for free on your computer, on your phone, on your iPad," Li insisted, comparing the service to Netflix or traditional TV.

Li said it was the quality of content that kept users coming back, citing internal company emails that he said showed executives rejecting a pursuit of internet virality in favor of educational and more socially useful content.

- 'Gateway drug' -

Stanford University School of Medicine professor Anna Lembke, the first witness called by the plaintiffs, testified that she views social media, broadly speaking, as a drug.

The part of the brain that acts as a brake when it comes to having another hit is not typically developed before a person is 25 years old, Lembke, the author of the book "Dopamine Nation," told jurors.

"Which is why teenagers will often take risks that they shouldn't and not appreciate future consequences," Lembke testified.

"And typically, the gateway drug is the most easily accessible drug," she said, describing Kaley's first use of YouTube at the age of six.

The case is being treated as a bellwether proceeding whose outcome could set the tone for a wave of similar litigation across the United States.

Social media firms face hundreds of lawsuits accusing them of leading young users to become addicted to content and suffer from depression, eating disorders, psychiatric hospitalization, and even suicide.

Lawyers for the plaintiffs are borrowing strategies used in the 1990s and 2000s against the tobacco industry, which faced a similar onslaught of lawsuits arguing that companies knowingly sold a harmful product.


OpenAI Starts Testing Ads in ChatGPT

The OpenAI logo is seen in this illustration taken May 20, 2024. (Reuters)
The OpenAI logo is seen in this illustration taken May 20, 2024. (Reuters)
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OpenAI Starts Testing Ads in ChatGPT

The OpenAI logo is seen in this illustration taken May 20, 2024. (Reuters)
The OpenAI logo is seen in this illustration taken May 20, 2024. (Reuters)

OpenAI has begun placing ads in the basic versions of its ChatGPT chatbot, a bet that users will not mind the interruptions as the company seeks revenue as its costs soar.

"The test will be for logged-in adult users on the Free and Go subscription tiers" in the United States, OpenAI said Monday. The Go subscription costs $8 in the United States.

Only a small percentage of its nearly one billion users pay for its premium subscription services, which will remain ad-free.

"Ads do not influence the answers ChatGPT gives you, and we keep your conversations with ChatGPT private from advertisers," the company said.

Since ChatGPT's launch in 2022, OpenAI's valuation has soared to $500 billion in funding rounds -- higher than any other private company. Some analysts expect it could go public with a trillion-dollar valuation.

But the ChatGPT maker burns through cash at a furious rate, mostly on the powerful computing required to deliver its services.

Its chief executive Sam Altman had long expressed his dislike for advertising, citing concerns that it could create distrust about ChatGPT's content.

His about-face garnered a jab from its rival Anthropic over the weekend, which made its advertising debut at the Super Bowl championship with commercials saying its Claude chatbot would stay ad-free.