New Report Suggests iPhone 8 May Be Delayed After All
Talk about mixed messages. The Apple (NASDAQ: AAPL) rumor mill has been in full swing ahead of the highly anticipated unveiling of the forthcoming iPhone 8, which should take place in September. Recent signs have been encouraging, suggesting that the iPhone 8 may launch on time, undermining prior reports that the device could be delayed to due manufacturing challenges.
Well, we now have a fresh report that the OLED iPhone might in fact be delayed -- until November.
Rumor has it
The Korea Herald's The Investor reports that the OLED-equipped iPhone 8 is being postponed until November due to challenges surrounding "some hardware and design features," citing anonymous sources from within Apple's supply chain. The only two iPhones that will be unveiled in September are the two that include traditional LCD displays (the iPhone 7s and 7s Plus), according to the report.
The source says that Apple is still planning on moving the Touch ID sensor to the rear of the device, contradicting other rumors that Apple has decided to ditch Touch ID altogether. "The [iPhone 8's] rear design has not yet been finalized. We are still awaiting Apple's final decision before shipping parts," a source told The Investor.
A lot of the delays have revolved around Samsung's OLED manufacturing capacity. While Samsung has long used OLED displays in its own devices, this will mark the first time that Apple has adopted the technology in the iPhone, which entails massive volume requirements. Thus far, Apple has only used OLED in a limited capacity, in the Apple Watch and the Touch Bar found on newer MacBook Pros. A separate source added, "The fact that Samsung's manufacturing lines are not running at full capacity at the moment hints at the delay of the OLED iPhone launch."
Give more weight to official financial forecasts
Lumentum Holdings (NASDAQ: LITE), one of the suppliers for 3D sensors, said that Apple has increased its demand by 25% to 30% in recent months, which was seen as a clue that other potential bottlenecks within Apple's supply chain could be improving. Only the flagship iPhone 8 is expected to include 3D sensing capabilities, so this increase in orders shouldn't be related to the iPhone 7s or 7s Plus.
Apple's own guidance for the fiscal fourth quarter was also particularly strong, and it's hard to imagine the company hitting upwards of $52 billion in sales in the September quarter if only the iPhone 7s and 7s Plus ship on time. Demand is always heavily concentrated on the new flagship model that Apple introduces, a fact that the company is keenly aware of when coming up with its own internal forecasts.
Investors are getting a lot of conflicting information, but I think we should give more weight to the official financial forecasts of Apple and its suppliers over rumors based on anonymous sources. Keep in mind that it's also a distinct possibility that the iPhone 8 launches on time -- which would explain Apple's bullish outlook -- after building a healthy stock of launch inventory, but then struggles to ramp production throughout the December quarter to meet demand on an ongoing basis. That would explain the rumors of low manufacturing yields and potential delays.
I'm still optimistic that the iPhone 8 will launch on time, even if Apple then struggles to keep up with demand.
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