Supplier Shortages from Thai Floods Could Affect 4M iPhones -Avian (AAPL)
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An analyst at Avian Securities is out with some concerning calculations related to the impact of the floods in Thailand on the Apple (Nasdaq: AAPL) supply chain.
The analyst's argument stems from recent comments out of Multi-Fineline (Nasdaq: MFLX) that it may not be able to ship $20-$25 million (or about 2-2.5 million units) in flexible PCB assemblies this quarter amid component shortages. Assuming the majority of the orders are for the Apple iPhone, the analyst believes more than 1 million iPhones may be impacted by shortages related to the floods from Multi-Fineline alone. Going another step, if Multi-Finline currently has about 25 percent of the market for the iPhone's flexible PCB assemblies, adding other suppliers (Mektron and Sumitomo are named) in the equation suggests some 4 million iPhones could be impacted.
While the full extent of these tragic floods will likely be unknown for some time, savvy managers and traders alike are already working to include component shortages into estimates. As a Bloomberg article from earlier noted, recent guidance out of Multi-Fineline seems to suggest subdued iPad expectations. If Apple can get ahead of the game -- it very rarely isn't -- fear may turn into opportunity.
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The analyst's argument stems from recent comments out of Multi-Fineline (Nasdaq: MFLX) that it may not be able to ship $20-$25 million (or about 2-2.5 million units) in flexible PCB assemblies this quarter amid component shortages. Assuming the majority of the orders are for the Apple iPhone, the analyst believes more than 1 million iPhones may be impacted by shortages related to the floods from Multi-Fineline alone. Going another step, if Multi-Finline currently has about 25 percent of the market for the iPhone's flexible PCB assemblies, adding other suppliers (Mektron and Sumitomo are named) in the equation suggests some 4 million iPhones could be impacted.
While the full extent of these tragic floods will likely be unknown for some time, savvy managers and traders alike are already working to include component shortages into estimates. As a Bloomberg article from earlier noted, recent guidance out of Multi-Fineline seems to suggest subdued iPad expectations. If Apple can get ahead of the game -- it very rarely isn't -- fear may turn into opportunity.
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