From a note to clients by Rosenblatt Securities’ Jun Zhang that landed in my inbox Thursday:
- Our research suggests that iPhone X shipments continue to ramp and could reach 3 million units by the November 3rd launch date. We also believe the iPhone X production rate increased this week to 0.8-1.0M units/week with Hon Hai starting a 24 hour production schedule.
- We believe Apple resolved the 3D sensing quality issue by replacing Murata components with new suppliers without reducing 3D sensing specs. We note that accuracy requirements are still very high and we no longer believe that 3D sensing is the iPhone X production bottleneck.
- Rather, we believe the current production bottleneck is the FCB [which is what?] from a new supplier in Taiwan and a new dual-core battery production ramp.
- Although 3D sensing assembly continues to face some yield issues, we believe LG Innotek can supply 4-5M units per month in October, higher than iPhone X production needs…
- We expect the Android market to start mass adoption of 3D sensing in 4Q 2018.
Zhang maintains his Hold rating and near-Street-low $150 price target.
My take: If it’s not one thing with Zhang, it’s another.
Below: My favorite assembly line.