Apple's Suppliers Projecting Weak Demand for iPhone 7 Due to 'Lack of In**vation'
 

http://cdn.macrumors.com/article-new...om-250x263.jpgApple recently reported its first year-over-year decline in iPhone sales, with CEO Tim Cook claiming one of the reasons is that the upgrade cycle for the larger iPhone 6 and iPhone 6s ****** has stretched out longer than it anticipated.

Despite the launch of the lower-priced iPhone SE, that decline is expected to continue into the second half of this year. In reporting its first negative-growth quarter since 2003, Apple forecasted a**ther revenue drop next quarter.

The sales decline is placing downward pressure on Apple's overseas suppliers, who have rode the iPhone's coattails to success over the past half-dozen years. **t only does LCD supplier Japan Display reportedly expect to post a nearly $300 million loss for the fiscal year ended March, but Nikkei reports that Apple's slowdown is also sending Taiwanese suppliers into a downward spiral.

"Suppliers are saying that they are getting fewer orders for the second half of this year compared with the year-ago period," a source said. "The traditional peak season this year will **t be able to compare to the past few years."

The report claims Taiwanese Semiconductor Manufacturing Company (TSMC), one of Apple's primary chip suppliers, may ship up to 30% fewer chips in the second half of 2016 compared to the year-ago period. The decline is attributed to the iPhone 7's expected lack of in**vative features, saturation of the smartphone market, increased competition, and a global eco**mic slowdown.

A**ther source said that for Taiwan Semiconductor Manufacturing Company, the sole supplier for the latest A10 chips used in iPhone 7, its iPhone 6s and iPhone 7 chip shipments for the June to December period will likely shrink to 70%--80% of the level reached in the second half of 2015.

Apple suppliers Largan Precision, LG Display, Catcher Tech**logy, Foxconn, and Pegatron have and will likely continue to face similar declines in the near term.

Largan Precision, a key high-end camera module supplier for Apple's iPhone, reported its first year-on-year decline in revenue in three years in the last quarter of 2015. The company has suffered a revenue fall for five months in a row since last December.

Adam Lin, chief executive of Largan, attributed the dip to a "significant scale-back of orders from a major customer."

Apple is expected to an**unce the iPhone 7 and iPhone 7 Plus, the latter of which may be branded with a "Pro" name instead, in September. Newly leaked drawings suggest both smartphones may have ** 3.5mm headphone jack and a single speaker, while a dual-lens camera system and Smart Connector will seemingly be exclusive to the larger 5.5-inch model with 3GB of RAM.

Related Roundup: iPhone 7
Tags: TSMC, Foxconn, pegatron

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