Makers in Apple's supply chain have seen no major changes to orders for iPhone 13 devices despite speculation about the US vendor looking to cut production for the new smartphones. The memory sector is entering a period of correction, with commodity DRAM prices likely to fall 15-20% in first-quarter 2022. Rising components, production and logistic costs are heaping pressure on notebook vendors.
Despite reports claiming Apple would cut its orders for the iPhone 13 series, sources from related camera module component suppliers have pointed out that their orders for October and early November have not seen any major changes.
TSMC has narrowed its revenue growth outlook this year to 24%, based on its forecast of 4.5% sales rise at the midpoint of the foundry house's latest guidance for fourth-quarter 2021. Despite a media report's claims that Apple is cutting its production goals for iPhone 13 seies for 2021, components suppliers have disclosed hey have not seen any reductions in orders from the client for the new smartphones. In China, manufacturers are making contingency plans to cope with power restrictions, which they expect will become a long-term policy of the country.
Component suppliers for Apple's new iPhones have seen no cutback in orders thus far this year, in contrast to a media report indicating Apple may slash its projected iPhone 13 production targets for 2021 by as many as 10 million units due to chip shortage, according to industry sources.
Notebook ODMs may experience a weak fourth quarter of 2021 with their feeble sales in China during the National Day holiday and possible low sales momentum during the year-end holidays in Europe and North America. Largan Precision also saw its gross margin hit the lowest in 25 quarters, but the percentage was still well above 59%. PCB maker Zhen Ding is also prepared to start making BT and ABF substrates in China in 2022.
Smartphone-use lens module maker Largan Precision released a financial report for the third quarter of 2021 at an October 7 investor conference, with a gross margin of 59.33% being the lowest quarterly level since the third quarter of 2015.
Tight fab capacity has been sending foundry quotes rising, which is expected to continue boosting profits for foundry houses in 2022. For the backend sector, supply of packaging leadframes is expected to remain tight with order visibility already extending to 2023. Networking device vendors are wary that chip and component shortages could curb their sales growth in the fourth quarter of 2021.
Despite speculation that TSMC has seen Apple and MediaTek cut orders for its 5nmand 7nm processes, the wolrd's top foundry house should still be able to achieve its sales targets in 2021, sources at its suppliers have maintained. And sources from the PCB sector have disclosed that order momentum from Appel for iPhone 13 remains normal. Meanwhile NOR flash supply is expected to remain tight through 2022.
Apple reportedly is cutting component orders for iPhones by up to 25%, but Taiwan's PCB makers in the supply chain for the new iPhone 13 have stressed their order momentum from the US vendor remains quite stable, according to industry sources.
Speculation has emerged in the chipmaking market that cutbacks in 5nm and 7nm chip orders placed by Apple and MediaTek could result in TSMC missing its revenue target for 2021 of over 20% growth. Nevertheless, sources at TSMC's suppliers remain upbeat about the foundry's sales prospects for the rest of this year.
India's Reliance Group might have to increase subsidies for its low-cost smartphone JioPhone Next more than it has previously estimated due to shortages of semiconductors and higher costs of components.
Notebook component suppliers in China are making contigency plans to cope with the country's power restrictions and they are expecting production costs to rise as a result. China's smartphone vendors are cautious about demand in the second half of the year, and remain slow in placying orders for components. But backend firms are upbeat about demand from smartphone processor vendors starting first-quarter 2022.
China-based smartphone vendors have increasingly adopted locally-produced OLED panels for high-end models, helping Chinese panel makers challenge Samsung Display's dominance in the global supply of smartphone-use OLED, according to industry sources.
MediaTek has been improving its product mix by putting increased focus on Wi-Fi chip solutions to meet robust demand for networking devices, which will effectively bolster testing business at its backend partners in the fourth quarter of 2021, according to industry sources.
Apple is working with multiple NAND flash chipmakers to develop cost-effective QLC (quad-level cell) NAND flash solutions, and could adopt the memory in its iPhone series as early as 2022, according to industry sources.
Backend firms have received engineering samples of next-generation smartphone APs from vendors such as Qualcomm and MediaTek, and expect a particularly strong first-quarter 2022 for processing smartphone APs, according to industry sources.
PCB and other handset component suppliers continue to see their China-based brand customers remain cautious about placing orders thus far in the second half of 2021, with order visibility for the rest of this year still being uncertain, according to industry sources.
Samsung sold nearly 300 million handsets in 2019, a number Samsung regards as its last line of defense, hoping to sell no less than 300 million handsets a year to sustain its business development. For every node in its wafer foundry business, Samsung has targeted mainly the mobile communication sector, which also renders Samsung the best opportunity of breakthrough. However, contrary to expectations, Samsung's share of the Chinese handset market has plunged to less than 1%, and in the Indian market Samsung is facing strong challenges from Xiaomi and Vivo. In order to maintain competitiveness in pricing, outsourcing to Chinese makers has become an option. It is estimated that about 60 million Samsung handsets are manufactured by outsourcing partners.
Taiwan-based makers of VCMs (voice coil motors), wire winding and other components of smartphone-use lens modules are giving priority to production for Apple, amid strong pre-sales of iPhone 13 series in China and Taiwan, according to industry sources.