(Bloomberg) -- Apple Inc. MacBook assembler Quanta Computer Inc. said its Shanghai campus recovered from Covid-related disruptions more slowly than expected, halving its profit.
Net income for the second quarter came in at NT$3.96 billion ($132 million), down 50% and below the average estimate of NT$4.3 billion. Sales totaled NT$270.5 billion, versus average analyst estimate of NT$258.4 billion.
Quanta announced in April its Shanghai site halted operations to comply with the local government’s Covid curbs. Spokesperson Carol Hsu said the company obtained approval to resume operations in a closed-loop system that same month, but the restart was bumpy due to logistics disruptions and a shortage of workers. The Shanghai unit returned to full production only in late June, she said.
“Meaningful recovery took longer-than-expected,” Hsu told analysts on a call about its Shanghai operation, calling the company’s results “disappointing.”
Quanta incurred significant expenses from keeping workers on campus and training new staff, she added. The Shanghai disruptions will continue to affect earnings in the third quarter, mostly from extra incentives it’s paying to retain enough workers, according to Chief Financial Officer Elton Yang.
Quanta makes some Apple laptops at its Shanghai plant. Faced with prolonged government-imposed lockdowns, that site saw violent clashes and mounting infections earlier this year, Bloomberg News has reported.
The extent to which that delayed Apple’s shipments remains unclear. While MacBook Pro models are immediately available in the U.S., there’s still about a two-week wait for the recently updated MacBook Air, according to Apple’s official website.
©2022 Bloomberg L.P.
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