Supply-chain companies for Apple Inc’s new 4.7-inch iPhone 6 may only provide 13.5 million units of the new handset this quarter, nearly 16 percent less than an earlier estimate of 16 million units, Yuanta Securities Co (元大證券) analyst Jeff Pu (蒲得宇) said yesterday.
The downward adjustment is due to issues involving the iPhone 6’s display, including problems of light linkage and lamination, which has led to design changes for suppliers, Pu said in a research note.
Pu’s remark came after Reuters reported on Saturday that suppliers of Cupertino, California-based Apple are rushing to redesign a key component, which has disrupted panel production ahead of next month’s expected launch. Japan Display Inc, Sharp Corp and South Korea’s LG Display Co are said to be the major suppliers of iPhone 6 screens, according to the report.
“Display appears to be the key bottleneck at this stage,” Pu said in the note, citing the brokerage’s recent supply chain checks.
He said both Sharp and LG Display had pushed back their production schedule to next month, while only Japan Display had resumed production this month. Apple is widely speculated to unveil its long anticipated large-screen iPhone at a scheduled Sept. 9 media event.
Meanwhile, the mass production of Apple’s 5.5-inch iPhone 6 by electronics manufacturing service (EMS) providers would also likely be pushed back slightly to October from next month, owing to problems with display panels and sapphire crystals, according to Pu.
Based on Yuanta’s forecast, demand for the iPhone 6 is expected to be very strong, although shipments could be constrained in the next two to three months.
“We forecast 70.5 million iPhone 6 units to be shipped in the second half of 2014, versus market expectations of 75 million to 80 million,” Pu said in the note.
“However, the supply constraints will very likely lead to a strong first quarter of 2015, owing to sizable upgrade demand from existing iPhone users and a potential market share shift from Android,” he added.
As for Apple’s reported smartwatch “iWatch,” Yuanta said volume production of this gadget might be as low as 3 million units in the fourth quarter of this year, as suppliers are set to improve production yields from December or January, when Apple adopts Corning Inc’s damage-resistant Gorilla glass as an alternative solution to the iWatch’s cover glass.
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