Your iPhone14 Hasn't Been Delivered Yet, But Price of These Apple Suppliers Has Primed! (U.S. Stock Edition)

In 2014, GT Advanced Technologies, a supplier of sapphire glass for display panels, declared bankruptcy after its share price plummeted when Apple "dumped" it.

Imagination Technologies, a supplier of graphics chips (GPU) to Apple and the UK's largest semiconductor maker, saw its shares plunge 70% to an eight-year low in April 2017 after Apple announced it would stop using Imagination's graphics chips any time within two years and terminate the payment of patent fees. The company has been an Apple supplier since 2008, and Apple is its largest customer, contributing more than half of its revenue.

After understanding the background of Apple's supplier selection, investors can avoid companies with a high percentage of revenue from Apple, and try to choose the absolute leader in those segments to reduce risk.

Hon Hai Foxconn is one of the major reasons that Taiwan is on the map for Apple. Foxconn is one of Apple’s oldest and largest suppliers. The company has its headquarters in Tucheng, New Taipei City. However, while being based in Taiwan, Foxconn is often thought of as Apple’s largest China supplier because of its vast number of Chinese supplier locations. In 2018, Foxconn had 35 supplier locations servicing Apple from Taiwan, China, India, Brazil, Vietnam, and the United States, and 29 of its 35 locations are in China. By 2021, Foxconn also helped Apple to branch out to India with one location there, as well as manufacturing in Brazil, eight locations in Mainland China, and one each in Texas and Vietnam.

NASDAQ-listed Qualcomm is a world leader in semiconductor, mobile, and telecom products and services. It is known to supply multiple electronic components to Apple, including envelope power trackers, baseband processors, power management modules, and GSM/CDMA receivers and transceivers. These are various instruments used in device power management systems and mobile signaling. Qualcomm has also come through for Apple devices, offering necessary modem technology. Modem technology is however at the core of the Apple, Intel, and Qualcomm 504 disputes. Apple announced it was buying Intel’s smartphone modem business. This led to a lawsuit by Qualcomm which resulted in maintenance of the modem manufacturing relationship for Qualcomm even after the Intel acquisition.

Murata is based in Kyoto, Japan. It supplies to Apple from 18 manufacturing facilities spread across Malaysia, Japan, Taiwan, Thailand, Vietnam, China, and Singapore. It has 10 supplier sites in Japan. Apple and Samsung are Murata’s top two clients, procuring ceramic capacitors from the company. These electronic parts are used to control the flow of electricity in electronic devices.

Qorvo provides radio frequency products for mobile terminals for the world's two largest smartphone companies (Apple and Samsung). Apple is Qorvo's largest end customer, contributing 33% of the company's revenue in FY2022 (+30% YoY). Samsung is the company's second-largest customer, contributing 11% of revenue in FY2022 (vs. 7% in 2021). Together, the two giants accounted for 44% of Qorvo's revenue.

Broadcom is a major supplier to Apple, supplying radio frequency chips that allow iPhones, iPads and Apple Watches to connect to cellular data networks. In addition, Broadcom has supplied Apple with other components, including chips that connect devices to Wi-Fi networks. On June 11, MarketWatch reported that Broadcom has signed a two-year supplier agreement with Apple, which is expected to usurp Qorvo and other RF components suppliers to become Apple's largest, and possibly exclusive, supplier of RF components. Notably, Apple said it would allow Broadcom to supply the components exclusively as long as the company met its quantity and quality commitments.

On 9.7, Apple announced the choice of GlobalStar as a partner to develop a feature that will allow iPhone 14 users to send emergency messages from remote locations. Globalstar shares edged up 3% after the bell. It rose more than 20 percent during trading hours but ended in slumping on Wednesday. The "satellite communications" feature has been speculated as a feature of new iPhone in the market for the past year, and price of satellite communications company Gostar, the most likely partner, has soared more than 80% in the past six months.