This year, Apple (NASDAQ:AAPL) announced three new iPhones at its Sept. 12 product launch event, but only two of the devices -- the iPhone 8 and iPhone 8 Plus -- made it into customers' hands by Sept. 22. Apple didn't even begin to take pre-orders for the third device, the iPhone X, until Oct. 27.
The iPhone X is expected to begin to make it into customers' hands starting on Nov. 3, though Apple's website now quotes ship times of five to six weeks for iPhone X orders placed now. It's clear, then, that demand for the iPhone X handily outstrips supply.
This situation is apparently due to the difficulties Apple faced -- and may still be facing -- in mass-producing key components inside the front-facing TrueDepth camera system.
But rumor has it there won't be similar problems next year.
According to KGI Securities analyst Ming-Chi Kuo in a note obtained by MacRumors, all the iPhones that Apple plans to introduce next year will "arrive on time under stable supply" late in the third quarter of the year. Next year's iPhones, Kuo previously claimed, will all include Apple's TrueDepth camera system. By contrast, only the iPhone X includes it this year. The iPhone 8 and iPhone 8 Plus have standard front-facing cameras.
Let's see what's being said about next year's lineup.
Same tech, but more mature
Kuo says the TrueDepth camera found on next year's iPhones won't include a "major spec upgrade." In other words, since the technology that'll be used in next year's iPhones will be like that used in this year's iPhone X, Apple won't see an increase in manufacturing difficulty related to the TrueDepth camera system next year.
In fact, if Kuo is right about that, then manufacturing the cameras for next year's iPhones should be easier than manufacturing the ones for this year's iPhone X. The longer a technology is in production, the better the company trying to produce it gets at building it, as production techniques are constantly being tweaked. Typically, that means higher yield rates -- the percentage of parts produced that are usable.
Higher yield rates can mean two things: more supply for a certain amount of manufacturing capacity, and lower manufacturing costs.
Good news for the 2018 iPhones
Since Apple is expected to include a TrueDepth camera in all new iPhone models next year, it'll need to produce far more of the TrueDepth cameras than it does this year. In addition, Apple is reportedly planning to include this technology on a next-generation iPad, which will further increase the number of such cameras Apple and its suppliers will need to produce. Higher manufacturing yields on the TrueDepth camera components should make it easier for Apple and its partners to churn out new devices incorporating the technology in time for Apple's usual product launch schedule.
To be clear, Apple could very well run into production bottlenecks on another feature or set of features in next year's devices. Apple needs to keep pushing the envelope in terms of new technologies and features, and a new feature, or maybe even several new features, in Apple's 2018 iPhones could hinder production. The key specs of Apple's 2018 iPhones haven't been leaked yet, so it's impossible to identify potential production bottlenecks for those phones right now.
However, if Kuo is right, the TrueDepth camera system won't be responsible for another glitch in the iPhone rollout schedule.
Ashraf Eassa has no position in any of the stocks mentioned. The Motley Fool owns shares of and recommends Apple. The Motley Fool has the following options: long January 2020 $150 calls on Apple and short January 2020 $155 calls on Apple. The Motley Fool has a disclosure policy.