Apple is now expected to sell fewer iPad 2 tablets in 2011, though not because of any waning of demand. According to analysts IHS iSuppli, Apple's production issues will be the main cap on sales; the company is now expected to sell a total of 39.7m iPad 2 units, as it works through what COO Tim Cook described as "the mother of all backlogs" in the recent financial results call.
Analysts had predicted sales of around 6.2m iPad units from Q1 2011, but Apple surprised the market by announcing 4.69m sales. Cook admitted that Apple had struggled to keep up with demand, though failed to specify any particular issues preventing production from ramping up.
Supply chain checks by iSuppli, however, indicate that rather than any one single problem, it's several factors delaying assembly. Apple is reportedly concerned over the quality of the LCD panels used in the iPad 2, while one of its touch panel suppliers is supposedly experiencing issues with the lamination process. Meanwhile the new iPad 2 speaker is also encountering production shortages. iSuppli says that Apple is nonetheless on-track to "significantly increase its production volume" this current quarter, but is "still falling substantially short of its target production goal for April."