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Broadcom rumored to place 'rush orders' with TSMC for iPhone 5 parts

post #1 of 6
Thread Starter 
Apple supplier Broadcom has been pegged as the most likely customer to have given Taiwan Semiconductor Manufacturing Co. a boost through a recent batch of "rush orders," with some analysts suggesting that the last-minute orders are for the next-generation iPhone.

TSMC revealed this week that rush orders from customers may cause it to exceed the guidance it gave in July. Sources quickly speculated that the orders had been placed by the foundry's fabless clients, such as Qualcomm, Broadcom, MediaTek and MStar Semiconductor.
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According to a new analysis from Bloomberg, Broadcom is the most likely choice because other large TSMC clients have recently disclosed disappointing results and lowered forecasts. Chipmakers such as Texas Instruments and Altera have reduced estimates due to flagging economic growth, but Broadcom reaffirmed its third-quarter forecast this week.

Broadcom is the largest link between Apple and Taiwan Semiconductor, said Richard Davenport, a Bloomberg supply chain analyst. Broadcom appears to be a likely candidate for Taiwan Semiconductors rush orders.

Taiwan Semiconductors data sticks out like a sore thumb, he added. We are seeing cuts on almost a daily basis.

Apple may have also found itself experiencing unexpected demand for the iPhone 4 despite the fact that its next-generation handset is believed to arrive in a matter of weeks. Late last week, Sterne Agee analyst Shaw Wu found demand for the 15-month old iPhone to be "surprisingly robust." Apple CFO Peter Oppenheimer said during last quarter's earnings conference call that a "future product transition" would contribute to a sequential revenue decline, prompting speculation that the company expected sales of the iPhone 4 to drop off ahead of a fall launch of a fifth-generation iPhone.

Rush orders are likely not from a new or unknown product, but rather imply more needed capacity with a mature product offering, Davenport said. He also noted that projected iPhone demand from Sprint or new Chinese carrier partners could cause an "upward revision" for Broadcom.

William Blair & Co. chip analyst Anil Doradla put forth an alternative, noting that TSMCs order could also have been placed by Qualcomm Inc. as part of a new deal with Apple for iPhone chips. Kaufman Bros.' Michael Burton noted that MediaTek and Nvidia were also possibilities, though he did point to the fact that Broadcom had reiterated its revenue forecast where others had warned of struggles.

As sales of the iPhone and iPad have continued to take off, Apple's suppliers have been buoyed by the increased revenue. Even as other chipmakers makes cuts, Apple could save the quarter for Broadcom, said Doradla. The iPhone maker reportedly accounts for about 11 percent of Broadcom's sales, making it the chipmaker's largest customer.
post #2 of 6
Rush it to my house!

I'm patiently waiting for my first iPhone!
post #3 of 6
However an obvious player has been left out here. Apple itself could be placing the rush orders for 28nm processors. I really don't think A5 is going into iPhone 5 without a process shrink.
post #4 of 6
Wouldn't it be great is Apple was in cahoots with someone on the release of a new 2nd gen 4G chipset? Apple will release the iPhone 5 as an LTE phone using a new 2nd gen 4G chipset that it has a deal with the manufacturer to keep under wraps until the iPhone 5 release. This would be real genius on both parties as Apple could bound into the LTE market a full year or more before anyone seriously expected them to, and the chipset supplier would garner a ton of free press by rolling out their release with the highly anticipated iPhone 5.

Of course, the reality is probably FAR from this little fantasy but wouldn't that be awesome?!?!

Oh how the Android fanboys would wail. The new iPhone 5 would step on one of their biggest issues and potentially provide significantly better battery life than anything currently on the market in the 4G space.
post #5 of 6
Quote:
Originally Posted by svnipp View Post

Wouldn't it be great is Apple was in cahoots with someone on the release of a new 2nd gen 4G chipset?

No, not really. There's not enough LTE worldwide to justify wasting my battery with it yet.
post #6 of 6
Quote:
Apple may have also found itself experiencing unexpected demand for the iPhone 4 despite the fact that its next-generation handset is believed to arrive in a matter of weeks. Late last week, Sterne Agee analyst Shaw Wu found demand for the 15-month old iPhone to be "surprisingly robust." Apple CFO Peter Oppenheimer said during last quarter's earnings conference call that a "future product transition" would contribute to a sequential revenue decline, prompting speculation that the company expected sales of the iPhone 4 to drop off ahead of a fall launch of a fifth-generation iPhone.

With Apple continuing to sell their just-replaced iPhones model for significantly cheaper price than the one it is introducing, it is no wonder demands for iPhone 4 will continue to be high. They are no slouch, iPhone 4.
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