Apple Seeks Self-Reliance In Power Management Chips for iPhones

Apple Seeks Self-Reliance In Power Management Chips for iPhones

IT

The analyst said that Apple was working on its own battery-saving chip for the iPhone that could replace Dialog's power management integrated circuits as early as 2019.

Anglo-German chipmaker Dialog Semiconductor (dlgnf) risks losing a crucial supply deal with Apple Inc (aapl), according to German investment bank Bankhaus Lampe, whose analyst cut his rating on the stock Tuesday from "hold" to "sell".

Dialog said it "knows of no business reason for this movement" and had no new information on the design cycle of its main customers.

Last week Imagination Technologies issued a statement announcing that Apple plans to go in-house with its graphic chips, too, causing the company's stock to go down by 70%. Iltgen published a research note that showed the company could lose a significant portion of its critical Apple business by 2019 as the iPhone maker moves some of its computer chip production in-house. The company's shares fell by 36 percent marking a seven-month low. However, he said Apple dropping Dialog "is unlikely in the short term".

Suppliers of Apple have been hit recently.

Apparently, Apple is poaching top Dialog engineers in Munich so that it has the knowledge in place to build the chip. "However, Apple itself could replace Dialog", wrote analyst Karsten Iltgen. That means the company will cut down supplies from its contractor - Dialog Semiconductor. "We acknowledge Apple's continued hiring of engineers, in power management and elsewhere, but an additional 80 engineers hired in this area pales in comparison to the over 1,300 engineers Dialog employed at the end of a year ago". When ARM was acquired a year ago by Japanese company SoftBank, industry observers started to wonder whether the move might affect the independence upon which it had built its success. 'They are poaching like insane, ' the person said.

According to Reuters, BoA-Merrill Lynch suggests a recent engineering hiring spree at Apple could be explained by the need to develop other products, such as cars, entertainment systems and existing phones.

However, over the past year Apple also hired several people from fellow supplier Imagination, including former Chief Operating Officer John Metcalfe as a senior director based in London.

  • Terrell Bush