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According to a tweet by Ming-Chi Kuo, an analyst at TF International Securities, Apple (NASDAQ:AAPL) has run into issues with its iPhone 5G modem chip development reported to have failed.
The analyst said that his latest survey indicates Apple’s “own iPhone 5G modem chip development may have failed,” meaning Qualcomm (NASDAQ:QCOM) will remain the exclusive supplier for 5G chips of the new 2023 iPhones, with a 100% supply share.
Qualcomm previously expected to supply only 20% of the modem chips to connect Apple’s iPhone wireless data networks by the device’s 2023 launch.
“Qualcomm’s revenue and EPS in 2H23-1H24 will likely beat market consensus thanks to its sole supplier position for 5G chips of 2H23 new iPhones as Apple fails to replace Qualcomm,” tweeted Ming-Chi Kuo. “I believe Apple will continue to develop its own 5G chips, but by the time Apple succeeds and can replace Qualcomm, Qualcomm’s other new businesses should have grown enough to significantly offset the negative impacts caused by the order loss of iPhone 5G chips.”
Apple has been developing its own modems for approximately five years.
Following the news, Qualcomm shares jumped more than 5%, while Apple is down 1.8%.
