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Source to Tai Sounds, in what is considered a major camera upgrade highlight for the iPhone 15 Pro Max, the “periscope lens,” Apple made no mention of it during its product announcement. Industry insiders suggest that the 5x optical zoom is achieved using a periscope lens, and Apple may have chosen not to disclose this technology, possibly due to competition within the industry. Renowned analyst, Ming-Chi Kuo, who is known for his deep understanding of Apple, stated that Largan Precision has expanded its production capacity to meet this order.
Kuo explained that Apple’s long-range camera for the iPhone will adopt a periscope design starting this year. This design will be used in the iPhone 15 Pro Max released this year and the iPhone 16 Pro Max and iPhone 16 Pro scheduled for next year. Largan Precision, a Taiwanese manufacturer, has expanded its production facilities in both Taichung and Xiamen to accommodate this order.
During the Apple product presentation, they emphasized the 5x optical zoom capability of the iPhone 15 Pro Max, claiming it’s equivalent to having seven individual camera lenses. However, there was no mention of the key technology, the “periscope lens,” which led some market experts to believe that the iPhone 15 Pro Max did not incorporate this technology, causing a decline in optical lens-related stocks.
According to the analyst, Ming-Chi Kuo’s, from Tianfeng Securities’ latest research on September 13th, Apple’s long-range camera for the iPhone will indeed adopt a periscope design starting this year, covering the iPhone 15 Pro Max, next year’s iPhone 16 Pro Max, and iPhone 16 Pro.
In terms of technical specifications, Kuo’s analysis indicates that the periscope lenses on the iPhone 15 and iPhone 16 will share similar specifications, including a 1/3″ 12MP sensor, f/2.8 aperture, Sensor shift support, and 5-6x optical zoom.
Kuo also pointed out that the cost of components depends on yield rates in mass production. Based on estimates using the cost of existing periscope lenses as a reference, the total production value of various components for the rear cameras of the iPhone 15 series in the second half of this year, including CIS, VCM, lenses, and CCM, is expected to grow by 5-10%, 20-25%, 65-70%, and 20-25%, respectively.
Benefiting from more iPhone 16 Pro models adopting periscope lenses and other rear camera upgrades, the total production value of various components for the rear cameras of the new iPhone 16 series next year, including CIS, VCM, lenses, and CCM, is expected to grow by 15-20%, 15-20%, 40-45%, and 15-20%, respectively.
Kuo also explained that among all the components, the lens specifications and business models are changing the most, and the growth in production value is most significant. A complete periscope lens module includes high-priced 1G2P lenses, two high-priced prisms, and lens barrels. High-priced materials are the key drivers of production value. Apple’s lens suppliers will provide more complex assembly services for the first time, as Largan Precision and Yujingguang have expanded their production capacities in Taichung and Xiamen, respectively, to meet this order. (Image credit: Apple.com)
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Source to ChinaTimes, according to rumors in the mobile industry, due to increasing uncertainties in the mainland Chinese market, Apple plans to make India one of the first launch markets for its iPhone 15 series and aims to produce the iPhone 15 series simultaneously in India and China. By manufacturing and selling locally in India, Apple hopes to reduce the uncertainties in the Chinese market.
Reports from ICsmart suggest that industry rumors indicate that as mainland China continues to increase regulatory measures, Apple is also accelerating its expansion into India to mitigate uncertainties in the Chinese market. Suppliers have revealed that in the past, the production of new iPhones in India lagged behind China by about a year, but last year, the production gap had narrowed to approximately one month. Apple is now even more determined to expedite the production of the iPhone 15 in India this year, with the goal of achieving near-simultaneous production in both China and India or reducing the production gap to within 10 days.
The report points out that before the iPhone 14, Apple only assembled a small portion of its phones in India, with a shipment schedule lagging behind China by 6 to 9 months. However, this gap was significantly reduced last year. By the end of March this year, 7% of Apple’s iPhones were produced in India. Foreign estimates suggest that by around 2025, the proportion of iPhones manufactured in India could reach 25%.
TrendForce believes India will become the second-largest production site for iPhone
According to TrendForce insights, Apple is indeed aiming to produce more iPhones in India. From the iPhone 14 series, The company manufactured iPhones almost simultaneously in India and China, reducing the initial production gap between the two countries.
If we take a look at iPhone assembly capacity, there is still around 5% in India. Although Apple plans to bring not only assembly but also key component vendors from China to India, supply chain partners are showing a passive attitude toward establishing production sites there, considering India’s policies, languages, cultural factors, and vulnerable infrastructures.
Foreign vendors will face the challenges above, however, as for Indian local vendors, challenges are mainly on technical capabilities, Therefore the most effective way to enter Apple’s supply chain is to acquire companies/factories that are already on the certified list. Just like the Tata Group did.
Also, TrendForce indicates, that with Apple’s intention, PLI, and the following incentive policies, we believe India will gradually become the second-largest production site of the iPhone in the future. However foreign vendors should be willing to suffer higher costs or successfully obtain any form of compensation from Apple, otherwise the transition process will continue to be slow.
The Indian “Economic Times” notes that with the release of the iPhone 15 series this week, the Indian market has the opportunity to be among the first countries for sales. Additionally, it is expected that after December, iPhones manufactured in India will be exported to Europe and the United States, signaling Apple’s progress in diversifying its supply chain. Apple is already the largest smartphone exporter in India.
The report indicates that Apple has raised its annual growth target for sales in over 200 premium retail stores in India for the second and third quarters to nearly 100%. Apple CEO Tim Cook also mentioned in the latest earnings conference call that the company broke its revenue record in India, the world’s third-largest smartphone market, and achieved double-digit sales growth.
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According to the news from ChinaTimes, Qualcomm announced on the 11th that it has reached a three-year agreement with Apple to supply 5G communication chips for Apple’s smartphones from 2024 to 2026. This also implies that Apple’s efforts to develop its own 5G modem chips may fall through, and the contract manufacturer TSMC stands to benefit the most.
Qualcomm did not disclose the value of this deal but mentioned that the terms of the agreement are similar to previous ones. Previous supply agreements have been highly profitable for Qualcomm but costly for Apple. According to UBS estimates from last month, Qualcomm’s sales of modem chips to Apple in the previous fiscal year amounted to $7.26 billion, accounting for approximately 16% of the company’s revenue.
This also highlights that Apple’s progress in developing modem chips may not be as expected, leading to a delay in their use in their flagship smartphones. Currently, Apple’s iPhones use 5G modem chips from Qualcomm.
Only a few companies worldwide have the capability to produce communication chips, including Qualcomm, MediaTek, and Samsung. In 2019, Apple acquired Intel’s smartphone modem business for $1 billion, along with 2,200 employees and a series of patents. Intel faced difficulties in developing 5G modem chips, resulting in annual losses of around $1 billion.
The market expects Apple to gradually reduce its reliance on third-party chip suppliers. Qualcomm originally estimated that by 2023, their 5G chips would make up only 20% of iPhones. However, Qualcomm’s CFO stated in November of the previous year that “most” of Apple’s phones in 2023 would contain their chips.
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Apple is slated to unveil four new iPhone models in mid-September: the iPhone 15, iPhone 15 Plus, iPhone 15 Pro, and iPhone 15 Pro Max. TrendForce predicts a production figure of approximately 80 million units for the iPhone 15 series. This represents a 6% YoY growth, bouncing back from last year’s Foxconn-related production hiccups. The Pro series, armed with smoother production cycles and the Pro Max’s exclusive periscope lens, is poised to be a consumer magnet and potentially propel the Pro series to constitute over 60% of Apple’s new device production. However, with overall gloomy market sentiment and Huawei’s comeback in full swing, Apple’s total iPhone sales for the year may take a hit, expected to hover between 220 to 225 million units for a 5% YoY decline.
In regard to specifications for the iPhone 15 series, several noteworthy hardware upgrades have been made. Compliance with EU regulations has led Apple to jump on the USB Type-C bandwagon this year. The iPhone 15 and iPhone 15 Plus will come with significant camera upgrades, sporting a 48MP main sensor to align with the Pro series. Furthermore, they will also be featuring Apple’s Dynamic Island. On the other hand, the Pro series promises cutting-edge processor upgrades, increased Dram capacity, and introduces a titanium-aluminum alloy frame. The Pro Max also intends to elevate mobile photography to the next level with its exclusive periscope lens.
Advances in technology, while exciting, can also ratchet up the intricacies of mass production. Reports of component snags and assembly issues have surfaced as production of the new iPhone models revs up in the third quarter. The iPhone 15 and iPhone 15 Plus, in particular, have been grappling with lower-than-expected yield rates for their new 48MP cameras. Meanwhile, the Pro series is confronting challenges with panel and titanium alloy frame assembly. However, evidence suggests that the Pro series is likely to overcome its obstacles more swiftly than its non-Pro counterparts.
iPhone 15 Pro Max may see a price increase to reflect cost differences
In light of the global economic downturn, Apple is contemplating a cautious pricing strategy to preserve its sales volumes. While the iPhone 15 and iPhone 15 Plus boast 48MP main cameras, they’ll inherit the A16 processor from the iPhone 14 Pro series, with no other significant upgrades. Hence, their starting prices are projected to be aggressively competitive. The iPhone 15 Pro may sport several enhancements that inflate costs, yet these are anticipated to be offset by cost reductions in other components.
Overall, TrendForce predicts a stable pricing landscape for the iPhone 15, iPhone 15 Plus, and iPhone 15 Pro, largely mirroring last year’s figures. The Pro Max, however, is a different story. Equipped with an exclusive high-cost periscope lens, it’s expected to command a premium—likely a bump of up to US$100—to reflect its increased production costs. Should this price adjustment materialize, it would mark the first such move since the era of the iPhone X.
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According to a report by Taiwan’s Economic Daily, the revival of the smartphone market has fallen short of expectations. Industry sources have indicated that in order to stimulate customer demand and expedite inventory clearance, Qualcomm has recently initiated a price war, targeting mid- to- low-range 5G smartphone chips. The price reduction is substantial, ranging from 10% to 20%. It is anticipated that Qualcomm’s price reduction strategy will extend into the fourth quarter.
The consumer electronics market began to slump in the fourth quarter of last year. Downstream inventory levels began to visibly dissipate in the first half of this year, gradually returning to normal. There was optimism in the market that the Chinese smartphone market would improve in the second half of this year, and there were even reports of a slight resurgence in Qualcomm’s chip shipments during the second quarter.
However, even after China’s 618 shopping festival, the downturn in the consumer electronics market has not shown significant improvement. This has led to Qualcomm’s inventory levels rising to nearly two quarters’ worth.
With low order visibility and high inventory, the supply chain has reported that Qualcomm has recently decided to initiate a price war, primarily focusing on the mid- to low-range market segment. If the pace of inventory clearance falls short of expectations, there is a possibility of further intensifying the price reduction efforts.
Industry analysts suggest that Qualcomm’s extensive price cuts underscore the challenging situation in the mid- to low-range 5G smartphone market, where demand has been lackluster.
(Photo credit: Qualcomm)