MacBook Neo Sells Like Hotcakes, Leaving Apple in a Bind

Apple’s strategy to release a budget version of the MacBook appears to be a resounding success, perhaps too successful, leaving its executives and supply chain team in a quandary. The high demand for the MacBook Neo, an entry-level laptop released to celebrate Apple’s 50th anniversary, is now creating a serious component shortage crisis. Ironically, the root of this problem stems from the “secret sauce” behind the laptop’s low price, namely the recycled processor. Apple is reportedly in discussions with its suppliers to decide on the next steps. Should they ramp up additional production at a much higher cost, or let the stocks of these colourful laptops slowly sell out in the market? For those who have wondered how Apple could release a new MacBook at such an “affordable” price, the answer lies in its internals. The MacBook Neo is powered by the A18 Pro chip. Interestingly, this is the exact same chip that serves as the “brain” for last year’s iPhone 16 Pro line. Apple utilised the leftover stock of A18 Pro chips from the initial iPhone production wave. They employed a method known as binning. Instead of discarding circuit dies with minor defects, Apple salvaged them by disabling one GPU core, then using them to power the MacBook Neo. With this trick of recycling surplus components, the chips were practically “almost free” for Apple. It’s no wonder the MacBook Neo’s price tag could be kept so low. Apple had projected the assembly of around 5 to 6 million units of the MacBook Neo by Foxconn and Quanta at their factories in China and Vietnam. Unfortunately, because the laptop is selling out beyond expectations, the supply of salvageable A18 Pro chips is now running out completely. If Apple wants to continue production to meet the overwhelming consumer orders, they must be prepared to dig deeper into their pockets. Ordering new A18 Pro chip wafers from TSMC will incur significant costs, as TSMC’s 3-nanometre fabrication lines are currently operating at maximum capacity.