Wednesday, August 06, 2014

There might be Sapphire on the iPhone 6 after all

This debate goes back and forth but an analyst did some math and inventory buildup might be evidence that the iPhone 6 will have a Sapphire display.

As the chart shows, GT has been building up a significant backlog of deferred revenue in recent quarters. While a portion of that is from its other products, the company reports that amount and it represents about $65 million in equipment as of the end of last quarter. When that’s subtracted out of the total, it leaves $154 million that Margolis says can pretty much only be sapphire. He believes Apple is paying $8-10 per screen for the material from GT (the finished goods price will be higher after it’s processed by Apple’s contract manufacturers) so that alone represents 15-19 million screens worth of sapphire.

“What this means is GT is already sitting on enough sapphire to satisfy Apple’s needs for the iPhone 6 launch in September,” Margolis said. “This deal was in the making for 2 years. They’ve been preparing this for quite some time.”

15-19 million screens seems to be a decent amount for the first run of iPhone 6s. They will probably fly off the shelves and GT Advanced will have to seriously churn out the Sapphire going forward. This article says that number needs to be 10 million screens a month in order to keep ahead of demand.

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