Foxconn International Holdings Ltd (FIH, 富士康控股) and Largan Precision Co (大立光) are likely the two firms that will benefit most from Amazon.com Inc’s plans to launch its own smartphones next year, Fubon Securities Co (富邦證券) analysts said yesterday.
The Hong Kong-listed FIH is the mobile phone unit of Hon Hai Precision Industry Co (鴻海精密), while Largan is Taiwan’s leading producer of handset lenses.
“There have been rumors that Amazon is working on a smartphone of its own, running a variant of the Kindle Fire Android operating system,” Fubon analysts led by Jeff Pu (蒲得宇) wrote in a note to clients. “It is becoming a reality, according to our checks, and the supply chain is expected to enter mass production in the second quarter of next year.”
Based on Fubon’s checks with Amazon’s suppliers, there are two models under development, one with a 4.7-inch screen and the other with a 4.3-inch screen.
Fubon said FIH might be the sole assembler of Amazon smartphones and predicted the firm would rake in between US$1.5 billion and US$1.6 billion in revenue, on expectations that Amazon might ship up to 6.5 million smartphones next year.
For component makers, the brokerage said Largan would likely be the main beneficiary if the US company adopts high-end specs, such as 8-megapixel lenses with higher resolution.
For Largan, the revenue contribution from Amazon might be smaller than that from Apple Inc’s iPhone, but the second-quarter ramp-up could “help the company ease the impact from the iPhone transition,” Fubon said.