In after-hours trading on Wednesday, a handful of Apple iPhone suppliers are having a nice afternoon. A few companies have reported earnings, which is leading to some optimism among the group and could also spell good news for iPhone unit sales in the near term.
Baseband main flame
The mobile-chip giant was forced to cut the top end of guidance for the full year from $19.7 billion to $19.1 billion. The low end stood pat at $18.7 billion. The same story played out with Qualcomm's profit forecast, reducing its best guess from $3.56 per share to $3.47.
CEO Dr. Paul Jacobs said the company continues to ramp up supply of 28-nanometer chips, which have been bottlenecked by primary manufacturing partner Taiwan Semiconductor Manufacturing all year long. The company has reportedly broadened its horizons by tapping additional manufacturers United Microelectronics and Samsung, and he expects a strong December quarter.
Qualcomm's 28-nanometer baseband chip is expected to ship in the next iPhone, supporting virtually every wireless standard known to man, including China Mobile's unique network, paving the way for an eventually partnership between the iPhone maker and the world's largest wireless carrier.
Despite the reduced guidance, investors are clearly focusing on the positives, such as higher expected average selling prices on devices and strong licensing revenue, sending shares higher by as much as 7% after hours.
The iPhone carries a power amplifier module from Skyworks, and investors may be hopeful that the strong guidance is being boosted by a possible win in the next-generation iPhone, which should be launched near the end of the year, coinciding with Aldrich's expectations of a "strong back half."
Shares have headed skywards by 12% and have tapped fresh 52-week highs in extended trading following up the results.
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Other iPhone component plays are riding the optimism, including Avago Technologies, up 2.3%, and TriQuint Semiconductor
The figures suggest that Apple might similarly be forecasting a strong "back half of 2012" for its sixth-generation iPhone and is characteristically beginning to lock down supply in advance. Assuming that these companies at least retain their spots, they also stand to ride Apple's coattails to riches.
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