Apple unlikely to sell sapphire iPhones this year, is setting the stage for future models - JP Morga
Apple's investments in sapphire may one day result in iPhone cover displays made of the material, but sapphire is unlikely to appear in this year's models due to prohibitive costs associated with producing the material in large quantities, investment firm J.P. Morgan said on Monday.
Analyst Rod Hall issued a note to investors, a copy of which was provided to AppleInsider, in which he reacted to a report from last week suggesting that sapphire display costs remain high. The source of that rumor was The Wall Street Journal, which made highly questionable claims that suggested Apple remains undecided about whether to use sapphire displays on its next iPhone, which is expected to be unveiled on Sept. 9.
Hall noted that Apple's sapphire partner, GT Advanced Technologies, has acquired a company known as Twin Creeks, which uses a wafering process dubbed "Hyperion" that could help to significantly reduce the cost of building a sapphire screen cover. Apple also has its own patent on sapphire laminates that Hall believes could further reduce costs.
Still, at the moment, Hall said that producing sapphire displays comes at a cost about 10 times greater than using Corning's Gorilla Glass. That's because the Hyperion ion implantation process isn't yet ready for mass production.
While Hall said it's possible that Apple this year could produce a line of expensive high-end iPhone models with sapphire displays in limited quantities -- something the Journal suggested Apple might do -- the analyst doesn't expect that to be the case for 2014.
"Although we have channel indications that some sapphire devices will be produced, we actually lean toward Apple selling no sapphire phones this year," Hall wrote.
"On sapphire as a feature -- we see it as a huge phone seller. The screens are reportedly unscratchable (except by diamond) and virtually indestructible. We believe most people will want sapphire when and if it ever becomes available."
Apple is said to be considering all-sapphire front panels for the iPhone because of the material's resistance to scratches and cracks. The company already uses sapphire to protect the iPhone 5s Touch ID home button, as well as the camera lens cover for the iPhone 5s and iPhone 5c.
Detractors, such as Corning, contest that sapphire in larger quantities is prone to shattering, and also makes displays harder to view in sunlight.
Speculation about sapphire in the next iPhone has persisted thanks to a $578 million deal Apple struck with furnace maker GT Advanced Technologies. The deal allows the companies to finance and jointly operate a Phoenix facility that will produce sapphire crystal material.
Analyst Rod Hall issued a note to investors, a copy of which was provided to AppleInsider, in which he reacted to a report from last week suggesting that sapphire display costs remain high. The source of that rumor was The Wall Street Journal, which made highly questionable claims that suggested Apple remains undecided about whether to use sapphire displays on its next iPhone, which is expected to be unveiled on Sept. 9.
Hall noted that Apple's sapphire partner, GT Advanced Technologies, has acquired a company known as Twin Creeks, which uses a wafering process dubbed "Hyperion" that could help to significantly reduce the cost of building a sapphire screen cover. Apple also has its own patent on sapphire laminates that Hall believes could further reduce costs.
Still, at the moment, Hall said that producing sapphire displays comes at a cost about 10 times greater than using Corning's Gorilla Glass. That's because the Hyperion ion implantation process isn't yet ready for mass production.
While Hall said it's possible that Apple this year could produce a line of expensive high-end iPhone models with sapphire displays in limited quantities -- something the Journal suggested Apple might do -- the analyst doesn't expect that to be the case for 2014.
"Although we have channel indications that some sapphire devices will be produced, we actually lean toward Apple selling no sapphire phones this year," Hall wrote.
"On sapphire as a feature -- we see it as a huge phone seller. The screens are reportedly unscratchable (except by diamond) and virtually indestructible. We believe most people will want sapphire when and if it ever becomes available."
Apple is said to be considering all-sapphire front panels for the iPhone because of the material's resistance to scratches and cracks. The company already uses sapphire to protect the iPhone 5s Touch ID home button, as well as the camera lens cover for the iPhone 5s and iPhone 5c.
Detractors, such as Corning, contest that sapphire in larger quantities is prone to shattering, and also makes displays harder to view in sunlight.
Speculation about sapphire in the next iPhone has persisted thanks to a $578 million deal Apple struck with furnace maker GT Advanced Technologies. The deal allows the companies to finance and jointly operate a Phoenix facility that will produce sapphire crystal material.
Comments
How about shorting GT Advanced and Apple stock than buy back before Apple's Sep 10 product announcement.
Somebody looking to short the stock?
I've always wondered how these people get any of this information. Either they make it up or their company has deep pockets and is paying for a lot of inside information. Of course, if they are paying for it, then I would think the SEC would be investigating them. On the other hand, I hope Apple is dropping some information to follow who is leaking the information so they can close those holes. There's way too many leaks, rumors, and guesses floating around on supposedly secret information for Apple to not be concerned.
I've consulted my morning tea leaves and see AAPL this week shattering the sapphire ceiling, surpassing $100.
To me, Sapphire front panel glass sounds exactly like the sort of 's' upgrade that would happen for a theoretical iPhone 6s. Better construction while keeping the exact same form factor.
Somebody looking to short the stock?
Actually for once someone is being logical. Every other analyst is creaming his shorts over this notion that Apple is going to go all sapphire on the new display phones. But is it ready for primetime. And is it costly at a level that makes it appropriate. Apple is loathe to raise retail costs more than perhaps $30-50 if they really really must. Can they still have a decent profit and increase the internal specs and do these fancy screens.
this guy is saying perhaps not. And perhaps they aren't ready to try yet. Maybe he's just saying it out of fear that all the prior rumors are false and he doesn't look like yet another dummy. Maybe he's actually trying to not 'falsely' short the stock by pushing something that is almost likely not true.
It is not likely that Apple inked a deal with GT Advanced last year and began production in 2013 for Apple and ramping up massive volume production with new high capacity (165kg + boule furnaces) of Sapphire shortly thereafter only to leave these parts on the shelf for about two years? GT also mentioned a new furnace technology to produce boules significantly larger than that for a special purpose.
I don't think Tim Cook would line the pockets of a supplier so far in advance of when that investment would yield components and revenue. I don't think Jony would drop hints this summer to the NYT about using new materials (possibly Sapphire and Liquidmetal)? I also doubt that this Sapphire deal is just for watch faces and camera lens and Touch ID covers.
This latest rumor is a stock manipulation scheme to short AAPL in advance of what should be a significant stock bump after the fall new product announcements and it doesn't quite jibe with what I've been reading about GT:
http://seekingalpha.com/article/2346705-what-could-justify-apples-big-investment-in-gt-advanced-technologies
http://investor.gtat.com/releasedetail.cfm?ReleaseID=845390
http://seekingalpha.com/article/2276673-second-apple-sapphire-plant-operations-emerges-from-gt-advanced-technologies-amended-10-q
http://www.macrumors.com/2014/06/16/jony-ive-new-materials/
And this:
http://www.macobserver.com/tmo/article/iphone-6-will-have-sapphire-glass-thanks-to-gtats-hoard
I highly doubt Apple would ever charge more, or premium-class a device, based on the glass becoming sapphire. No one would care.
"Unscratchable" makes a decent bullet point, but people won't specifically pay more for it.
I got in at around $9 and intend to hold for the long run ... it's been an interesting ride so far ... lol
You think Apple is planting this rumor to tamper down expectations for iPhone 6? The rumors so far suggest not much to be excited about other than a bigger screen.
There's only so much more you can do these days in terms of hardware to get people "excited", that don't come off as gimmicks, and that the majority of consumes can actually functionally and meaningfully use on a day to day basis. For me, a bigger screen, improved design, extra sensors, and improved processing capabilities are pretty exciting, as well as the most important things, iOS8 and the entire iCloud ecosystem.
Now that's a rumor I like
I got in at around $9 and intend to hold for the long run ... it's been an interesting ride so far ... lol
Holy shit.. for you, there's more apt words that "interesting", since you've seen around an 8000% return.
It's possible Apple has found a way to bond a thin sapphire layer to Gorilla Glass that won't involve excessive costs or need for huge amounts of sapphire. That would make the display unscratchable and durable. I don't think anyone knows for certain what Apple is going to do. Most of these articles are pure speculation.