Apple's iPhone supply seen improving with Black Friday on deck

Apple released the iPhone 13 in late September with high expectations for the phone to be the engine behind the company's busiest business quarter. But, ongoing shortages of semiconductors, including those used in the iPhone, have led to some concerns about Apple being able to get enough iPhones on retail shelves to meet its customers' demands. There have even been recent reports saying that Apple has shifted production of iPads in order to use parts from those tablets in the iPhone 13.

However, there is new evidence suggesting that supplies of iPhones are improving, which could go a long way toward alleviating shoppers' worries about not filling out their gift lists, and boosting Apple's sales figures.

In a look at the the iPhone market, Morgan Stanley analyst Katy Huberty said that many tech companies are still working through supply chain disruptions brought on by the Covid-19 pandemic, but there signs that some stabilization has emerged in recent weeks.

"Recent checks indicate supply of power management IC's [integrated circuits, or microchips] and world-facing camera modules for the iPhone 13 Pro [and] Pro Max is improving," Huberty said. "[This is] indicating that iPhone builds will likely sequentially improve in November and December."

That would be good news for Apple, and could alleviate some of the impact the company has said it will see from component supply chain issues. When Apple reported its fiscal fourth-quarter results in October, it said its sales suffered from a $6 billion impact from supply chain shortages, and that amount will increase in it current quarter.

If any evidence was needed to see how important the iPhone is to Apple, all one needs to do is look at the company's sales for its fiscal first quarter a year ago, which included its holiday season sales. During that period, Apple's iPhones, which included the then-new iPhone 12, accounted for $65.6 billion of the company's $111.4 billion in total revenue.

Huberty said that as of Nov. 23, or 67 days after the start of iPhone 13 pre-orders, lead times for the iPhone 13 Pro and Pro Max were clocking in at 19.5 days. Huberty said that lead time is "the second strongest among all [iPhone] models in the last five years" at this point in the device's sales cycle, and is down by 7 days since early November. Huberty also said that lead times for the iPhone 13 and iPhone 13 mini are contracting, too.

"All of this contributes to our view that October iPhone data was negatively skewed by production headwinds," Huberty said. "Data for the month of November should show an above-seasonal improvement relative to October."

Along with Huberty's assessment of iPhone supply, J.P. Morgan analyst Samik Chatterjee said on Tuesday that there is growing evidence of Apple shipping a record number of iPhones in China in October.