Apple power chip supplier Dialog Semiconductor isn't seeing a reduction in orders

AppleInsiderAppleInsider
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in AAPL Investors
Power management tech supplier Dialog Semiconductor hasn't seen the same hit to its business that other Apple suppliers have encountered in recent times, CEO Jalal Bagherli claimed on Wednesday.

iPhone XR


Bagherli credited the situation to Dialog technology being installed in many Apple devices. "Some products will have less volume, but others will have higher volume. So we have more chance of compensating [for] changes," Bagherli said at the Morgan Stanley TMT Conference in Barcelona, quoted by Reuters. "It is a volatile market, so there will be change almost weekly in terms of the forecast for the rest of the quarter or into the following quarter."

Dialog has already secured two Apple design wins for 2019, according to Bagherli, involving subsystem and charger components.

Several Apple suppliers -- Japan Display, IQE, and Lumentum -- saw their stocks fall this week based on lower revenue forecasts. Their performance has in turn hit Apple's share price hard, bringing it below $190 to levels not seen since July.

The source of problems may be the iPhone XR. While well-reviewed, and $250 cheaper than the iPhone XS, the product may not be selling as well as initially expected. TF Securities analyst Ming-Chi Kuo recently slashed his sales forecast for 2019 by 30 percent.

In October, Apple forged a $600 million deal with Dialog to license patents, buy assets, and recruit workers as it moves to bring power management in-house. Dialog is aiming to reduce its dependence on Apple to between 30 and 45 percent by 2022.

Comments

  • Reply 1 of 6
    2old4fun2old4fun Posts: 239member
    Is this a possible insight as to how customers view Apple products? Compare this to the iPhone 5c, lower price means one is not getting the "real deal". Even though the marketing has tried to make it clear that the XR has mostly the same internals as the XS, customers see themselves showing everyone that they could not afford a "real" iPhone. How many iPhone 5c were purchased for children as Christmas presents? This does not continue sales after the season. And it enforces the "toy" view of the device. How many 5c's were upgraded to the iPhone 6 the next year? It seems that customers are viewed as swayed by price more than value. This could be showing that to not be true for some products. Apple may be viewed as unique enough to be damaged by the highly desired "market share" view of success.
    watto_cobra
  • Reply 2 of 6
    physguyphysguy Posts: 920member
    Or, could it be there is no significant reduction is demand?  II-VI just bought Finisar and last year bought Anadigix, both of whole compete with Lumentum for Apples VCell business. Could it possibly be that there was a shift in supplier to a newly dominant player?  While I’m not as familiar with Japan display it would seems possible there is a similar story there. Could it be that analysts have their collective heads ....
    watto_cobra
  • Reply 3 of 6
    ne1ne1 Posts: 69member
    2old4fun said:
    Is this a possible insight as to how customers view Apple products? Compare this to the iPhone 5c, lower price means one is not getting the "real deal". Even though the marketing has tried to make it clear that the XR has mostly the same internals as the XS, customers see themselves showing everyone that they could not afford a "real" iPhone. How many iPhone 5c were purchased for children as Christmas presents? This does not continue sales after the season. And it enforces the "toy" view of the device. How many 5c's were upgraded to the iPhone 6 the next year? It seems that customers are viewed as swayed by price more than value. This could be showing that to not be true for some products. Apple may be viewed as unique enough to be damaged by the highly desired "market share" view of success.
    I'm inclined to agree with you but I'll put it another way: Multi-colored iPhones reduce Apple's brand cache because they seem "less than" the flagship iPhone. Anytime I see Apple coming out with multi-colored iPhones, I start to worry. I know I would never buy one. They should present the XR as another premium (but lower cost) option with space gray, silver, gold. Forget the other colors.
  • Reply 4 of 6
    mdriftmeyermdriftmeyer Posts: 7,503member
    It should be obvious to anyone that understands corporate contract laws that no agreement can disclose any specific claims directly. Claims so far have been spurious and general, leading the Market to conclude it must be a slow down in orders by Apple.

    In reality, Apple routinely looks for other suppliers to garner better profit margins for key parts and to send a shot over the bow to the current supplier they aren't the only game in town, so to speak.

    They routinely blow past projections and later disclose they've switched suppliers levels.

    Who never gets throttled for the market manipulation, the stock market analysts and brokers producing inferences.

    This is where the Analysts gleaned their information from Lumentum.


    "We recently received a request from one of our largest Industrial and Consumer customers for laser diodes for 3D sensing to materially reduce shipments to them during our fiscal second quarter for previously placed orders that were originally scheduled for delivery during the quarter," said Alan Lowe, President and CEO. "With our proven ability to deliver high volumes, years of experience, hundreds of millions of devices in the field, and new product and customer funnel, we remain confident in our leadership position in the nascent market for laser diodes for 3D sensing."


    Anyone with half a brain knows the markets assumed, ``....one of our largest...'' to be actually, ``...one of our largest Industrial and Consumer customers, Apple, for ...''

    And that justified the next $15 in price reduction.

    When do we require Analysts, NASDAQ, Corporations to fully disclose their spurious assertions during guidance calls? Hell, 3D sensing could mean Samsung, Google, Huwai (sp?), etc. But it must be Apple, thus ``hey! Apple's reducing orders of iPhones.''

    Now today, power management company Dialog Semiconductor says everything is right as rain.

    Meanwhile, watch the next three days, including Monday, as how much the market rebounds. Apple will most certainly be buying back more stock.
  • Reply 5 of 6
    dedgeckodedgecko Posts: 169member
    Meanwhile, watch the next three days, including Monday, as how much the market rebounds. Apple will most certainly be buying back more stock.
    Them, Berkshire Hathaway, and anyone else who’s long for the company. I’m buying some more tomorrow. 
    watto_cobra
  • Reply 6 of 6
    apathy_foreverapathy_forever Posts: 8member
    I have said this before, but really, supplier forecasts are wildly inaccurate for predicting how a product is selling. Supply management strategies change all the time. Sometimes you can buy every part you need all at once and store them for the entire life cycle of the product. Other times you can hedge your bets partially by buying 6 months worth of parts. Apple does not appear to be a Just-in-time delivery company. It's entirely possible they keep large inventories of parts. When you have lots of supply in storage, how much you buy from them on a weekly basis does not have any real meaning, does it?
    watto_cobra
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