Key Takeaways:
Citi forecast iPhone 18 production at 81 million units in the second half, naming four Apple suppliers as upgrade beneficiaries.
"SoC supply constraints will increase significantly, while supply chain flexibility in the September quarter remains limited," Citi analysts wrote in a research report.
Apple's June quarter revenue rose 16 percent year over year to $109.4 billion, with net profit up 22 percent. iPhone sales climbed 22 percent and Mac sales 29 percent, while the company guided September revenue growth of 9 to 11 percent. Citi's latest production plan shows third-quarter output remains strong, up 22 percent year over year.
The iPhone 18 forecast of 81 million units for the second half is below Citi's prior estimate of 84 million, including 7.5 million foldable models. Key upgrades include foldable phones driving demand for ultra-thin glass, hinges, titanium casings and vapor-chamber cooling, plus variable-aperture main cameras on Pro and Pro Max models.
Among beneficiaries, LUXSHARE Precision gained market share with supply ratios for Pro and Pro Max models at about 31 percent and 41 percent respectively, while securing actuator orders. LENS Technology supplies foldable ultra-thin glass, AAC Tech supplies vapor-chamber cooling systems, and Sunny Optical gained lens market share and actuator orders. Foxconn remains the exclusive EMS supplier for the iPhone 18, with Pegatron and Tata supplying about 7 percent of the Pro Max segment.
Apple's China sales rose 22 percent year over year, even as China smartphone sell-in shipments fell 16.6 percent in June to 17.1 million units. Citi said shipment performance was supported by inventory build-up ahead of supply constraints, while fading subsidies and rising average selling prices continued to pressure sell-out sales.
The upgrade beneficiaries face a mixed second half, with some first-half results expected to beat market concerns on inventory build-up, though pressure may intensify in the second half. Investors will watch supplier earnings and Apple's fall product launch for updated production signals.
This article is for informational purposes only and does not constitute investment advice.
