Sony, a major supplier of Apple’s camera sensors, suggests weaker demand for the upcoming iPhone 15 due to a lackluster year for Apple’s iPhone sales. Economic challenges have affected iPhone sales, though service revenues have offset losses. The flagship iPhone 15 series is scheduled for a September release.

Sony the world’s largest sensor supplier, had previously projected a gradual recovery in its smartphone imaging and sensing business by the second half of 2023. However, during its latest earnings call, the company revealed that this recovery might not take shape until 2024, mainly attributing the delay to underwhelming sales in the Chinese market.

Sadahiko Hayakawa, Sony’s Senior General Manager of Finance, stated, “The recovery pace of the Chinese smartphone market has been slower than our expectations, and the situation in the US market is worsening. We originally anticipated the smartphone market to recover starting from the second half of this fiscal year, but our current assessment suggests that it might not happen until at least next year.”

Sony’s top brass attribute a cautious outlook to a sluggish global economy and geopolitical uncertainties, hinting at muted demand for the iPhone 15 series. This stance resonates with analyst Ming-Chi Kuo view at TFI Securities, forecasting that iPhone 15 might struggle to surpass iPhone 14 sales records, posing challenges to Apple’s suppliers in H2 2023.

Apple reported a 2.4% decline in iPhone sales for its third fiscal quarter, reaching $39.7 billion, slightly below analyst estimates of $39.9 billion. The US region saw a 5.6% year-on-year drop in sales, highlighting a performance that falls short of expectations.

(Source: https://news.cnyes.com/news/id/5282617)

In about a month’s time, the smartphone market is gearing up for Apple’s flagship iPhone 15 series of the year. This annual anticipation leads to a surge in online appearances of models for reference, typically emerging one to two months ahead of the new phone’s unveiling. TechNews, a Taiwanese tech media also acquired an accurate mock-ups mimicking upcoming iPhones, providing an advanced peek into the forthcoming changes in this year’s iPhone 15 series.

• Maintaining 4 Models, 2 Sizes

Similar to last year’s iPhone 14 series, Apple is projected to release 4 models in 2 sizes this year. These include the 6.1-inch iPhone 15 (which some suggest might grow to 6.2 inches) and the iPhone 15 Pro, along with the 6.7-inch iPhone 15 Plus and iPhone 15 Pro Max (which could potentially be renamed iPhone 15 Ultra).

• Entire Series Adopts Dynamic Island

Dynamic Island design made its debut in last year’s iPhone 14 Pro series, while the iPhone 14 and iPhone 14 Plus retained the traditional notch design. However, even the more affordable iPhone 15 variant will undergo a change, syncing with the Pro version by replacing the notch with a dynamic island design.

Notably, due to the adoption of the dynamic island design for the iPhone 15, some speculate that the screen size might marginally expand to 6.2 inches this year.

• All 4 Models Get a ‘Port’ Change

In response to EU regulations, rumors in the market suggest that Apple is set to switch all models in the iPhone 15 series from the previous Lightning port to the USB-C charging port. From the obtained muck-ups, it appears certain that the entire iPhone 15 series will indeed transition to USB-C ports.

• Larger Camera Modules, Slight ‘Slimming’ for Pro Models

Fitting iPhone 15 series muck-ups with protective cases designed for the iPhone 14 series reveals that, while all 4 models can accommodate iPhone 14 series cases, a closer examination of the camera reveals that the iPhone 14 series case slightly interferes with the lowermost lens.

Furthermore, this year’s iPhone 15 Pro series will have further narrowed screen bezels, down to 1.55mm from the previous 2.2mm. Consequently, the iPhone 15 Pro muck-up will be slightly slimmer than their iPhone 14 Pro predecessors, resulting in a slightly looser fit when encased.

Other Speculations

The information provided by the muck-ups remains limited, leaving us to wonder about potential additional changes to this year’s iPhone 15 series.

As expected, the iPhone 15 Pro series processor is likely to see an upgrade to the A17 Bionic chip (manufactured using TSMC’s 3nm process), while the more budget-friendly iPhone 15 and iPhone 15 Plus will possibly adopt last year’s A16 processor from the iPhone 14 Pro series (manufactured using TSMC’s 4nm process).

Regarding memory capacity, the iPhone 15 Pro series could see an upgrade from 6GB to 8GB, while the iPhone 15 and iPhone 15 Plus might retain 6GB.

Additionally, it’s rumored that the iPhone 15 series’ ultra-wideband chips will all be upgraded to U2 chips, with the manufacturing process transitioning from the previous generation U1 chip’s 16nm to a 7nm process; this is expected to enhance the energy efficiency performance through this improvement.

In terms of battery life, there’s speculation that the entire iPhone 15 series will adopt ‘stacked batteries’ to enhance endurance. The speculated battery capacities for the four models are as follows: iPhone 15 (3877mAh), iPhone 15 Plus (4912mAh), iPhone 15 Pro (3650mAh), and iPhone 15 Pro Max (4852mAh).

According to the news reports from money.udn, which indicate that Foxconn, the prominent tech manufacturer, has clinched a substantial contract to supply Apple with AI servers, marking a monumental stride into the Apple AI server market. Notably, these servers will be dispatched from Foxconn’s manufacturing facility in Vietnam, positioning it as a pivotal player in Taiwan’s burgeoning AI sector.

While Foxconn traditionally refrains from commenting on individual clients and order specifics, market insiders reveal that Foxconn is not only the foremost assembler of Apple iPhones but also a crucial supplier of data center servers. As Apple charges ahead in the realm of AI applications, necessitating heightened support from AI servers, Foxconn’s stronghold in the AI server market has positioned it as Apple’s preferred collaborator due to its longstanding partnership.

Insiders indicate that Apple’s directive has prompted Foxconn to exclusively ship AI servers to Apple via its subsidiary, Foxconn Industrial Internet (FII), stationed in Vietnam.

Market research firms report that Foxconn currently holds a substantial global server market share of approximately 43%. This prominence not only establishes Foxconn as a manufacturing leader but also as the primary supplier to Amazon, the global cloud services (CSP) frontrunner. Having already supplied AI servers for ChatGPT and NVIDIA, and with primary customer Google rapidly venturing into generative AI, along with Apple’s recent strategic foray, Foxconn is poised for a surge in server business orders.

Apple’s CEO, Tim Cook, recently confirmed Apple’s longstanding involvement in various AI technologies, including generative AI, while emphasizing the current surge of resources into AI development. With Apple’s R&D expenditure rising to $22.61 billion last quarter, experts speculate that a significant portion has been allocated to AI development.

Moreover, international sources report that Apple is discreetly crafting the “Ajax” large-scale language model, potentially heralding the arrival of the generative chatbot “SiriGPT” in the near future. With Apple’s vast user base across the globe, abundant data resources could pose a threat to rivals such as Google and Microsoft.

Industry pundits assert that Apple’s extensive global user feedback from devices like iPhones, iPads, and Macs, combined with the mature ecosystem of the App Store, endows it with a strategic advantage in AI application development. Swiftly advancing AI server and data center deployment could enable Apple to navigate the curve and surge ahead in this competitive race.

Foxconn’s Chairman previously expressed optimism in the growth potential of CSP and AI servers. With Foxconn’s server revenues reaching $1.1 trillion last year, the company’s status as a server manufacturing leader naturally aligns with this burgeoning demand. Industry estimates underscore the dramatic increase in Foxconn’s AI server-related orders, reaching several billion dollars. This positions Foxconn as the definitive victor in the current AI wave, solidifying its place at the forefront of global AI server leadership.

(Source: https://money.udn.com/money/story/5612/7351082)

According to the latest report from TrendForce, the primary factors influencing the global market share of notebook CPUs in 2024 can be categorized into “Architectural Design” and “Economic Factors.”

“Architectural Design” as a long-term factor affecting market share:

(1) Both AMD (AMD 3D V-Cache) and Intel (Intel Foveros Direct) may potentially integrate 3D packaging technology into notebook computers in the future.

(2) Apple’s M-series processors, using the Arm core architecture, as well as Intel processors, have adopted a big/little core hybrid design. AMD might also introduce this in the Ryzen 8000 series.

(3) Despite further advancements in processor technology by 2024, the notebook computer market remains highly sensitive to the cost for IT equipment.

“Economic Factors” as more immediate influencers of market share:

(1) Until 2024, a return to lower interest rates in the global economic environment could favor corporate expansion of capital expenditure. This could result in increased procurement of business-oriented notebook models, potentially allowing Intel to further expand its CPU market share beyond 70% in the business sector.

(2) Concerns about economic prospects among global citizens until 2024 could have significant negative implications for the consumer notebook computer market. With the restart of physical economic activities, the demand for consumer-oriented notebook models has declined from the high levels seen during the pandemic. Consequently, the consumer market demand outlook for 2024 remains uncertain. For AMD, which relies more on consumer market demand, changes in market share may be harder to predict compared to Intel.

In the post-pandemic era, AMD, Arm/Apple, and Intel are pursuing distinct technological competition strategies to capture market share in the personal computing market.

AMD:

(1) The Socket AM5 platform is poised to aid AMD CPUs in achieving substantial performance and efficiency gains.

(2) The AMD Ryzen 7040 incorporates an artificial intelligence engine to emphasize AI computing performance’s importance in the thin and light notebook market.

Arm/Apple:

(1) The M2 Ultra processor heralds Apple’s complete transition of personal computing products to the Arm core. Apple Mac computer products will no longer be sold with Intel processor.

(2) The Apple M-series processors, built on the Arm core architecture, facilitate a “fanless design” to maintain MacBook’s slim profile. This feature highlights its irreplaceable positioning in the portable notebook computer market, emphasizing portability.

Intel:

(1) With the waning trend of the “hybrid work mode,” Intel is optimistic about diversified development in the post-pandemic era for desktop computer products. This includes microcomputers, micro workstations, and general workstations. Due to the characteristic of continuous operation for 24 hours, desktop computers still possess unique attributes that cannot be replaced by notebook computers.

(Photo credit: Intel)

As the mass production of the new iPhone draws near, TrendForce, in April this year, raised concerns in the smartphone industry about several design changes made to the 2023 iPhone models almost half a year ahead of production. The industry is closely monitoring whether related components can keep up with the production schedule to ensure smooth execution of subsequent assembly plans. Recently, TrendForce provided updates on the production progress and details of these components.

According to TrendForce’s investigation, two critical components in the iPhone supply chain are causing worries about potential supply issues – the CIS (CMOS Image Sensor) and the titanium alloy frame. Currently, there are still bottlenecks in the production of these components that need to be overcome.

Regarding the CIS, the bottleneck arises from Sony’s supply of the new 48MP CIS, which is expected to be used in iPhone 15 and iPhone 15 Plus. This CIS adopts a new stacked design, separating the CIS photodiodes and peripheral transistors into three layers instead of the previous double-layer structure. This poses a significant challenge to yield rates, and despite Sony’s efforts to increase production capacity to cope with the yield ramp-up difficulties, the supply situation does not meet anticipated levels, affecting the initial production schedule of the entire device.

As for the titanium frame, due to the elimination of the pressure-sensitive button structure and the slight adjustment in the opening for the mute switch, the suppliers need to re-allocate, set up, and verify the basic operating time of the production lines.

Additionally, the processing procedures for titanium are more complicated compared to stainless steel, which leads to longer production lead times. TrendForce confirmed recently that the titanium frame for the new iPhone is currently one of the components with lower yield rates and supply stability. Therefore, suppliers have expanded production capacity by 20-30% and are working diligently to ensure that even if the initial supply is tight during the early stages of production, they can respond accordingly, ensuring that the launch and supply of the entire device will not be affected.

Given the supply constraints of these two components mentioned above, TrendForce believes that Apple may increase the production proportion of the two Pro models in 3Q23 to fill the gap caused by the initial iPhone 15’s production capacity shortage. This adjustment, in an optimistic scenario, will only involve shifting production proportions between different models in two quarters, with no impact on the annual shipment performance. TrendForce assesses that this possibility is more likely under the current circumstances.

However, if the CIS yield bottleneck is difficult to overcome, it could lead to a substantial reduction in the shipment volume of the 2023 iPhone models. TrendForce will continue to monitor the situation closely.