Wintek, Apple’s supply chain partner that makes touch panels used in iPhones, saw a steep drop of sales of its panels for the month of June. Brian White, an analyst with Topeka Capital Market, links this slump to Apple switching to in-cell touch sensing technology in its next-generation products.
Wintek’s sales decreased by 33.6 percent month over month, which is unusually low for the company’s average June growth rate of 1 percent.
While some people could interpret a dip in sales of Wintek’s touch panels to directly correlate with iPhone sales, White thinks otherwise:
This morning, Wintek reported consolidated June sales of NT$5.22 billion, down 33.6% MoM and much worse than the average MoM June sales increase of 1% over the past seven years. Based on our records, this appears to be the biggest MoM sales drop for Wintek since the later part of 2008 and one of the most significant drops we have on record (back to 2005). We would not overreact to the weakness at Wintek as it relates to Apple because we believe Wintek may be losing market share in key next generation Apple products and therefore ramping down certain programs.
In the past, we estimate Wintek generated over 50% of total sales from Apple as an important touch panel supplier in products such as the iPhone and iPad; however, we believe the company may be losing market share in next generation products.
By using these panels, Apple could shave off more than a millimeter of thickness from the next iPhone. The time required for producing the panels would also drop from the current 12-16 days to just 3-5 days, if Apple does make the switch to in-cell touch panels.