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Top 5 Apple Suppliers To Buy Now
Buying shares of Apple, which generated over half its revenue from iPhones in the first nine months of 2020, is the easiest way to profit from that upgrade cycle. However, investors shouldn't overlook five other Apple suppliers that should benefit from brisk sales of the iPhone 12.
top 5 apple suppliers to buy now
Cirrus' high exposure to Apple often enables it to outperform many other Apple suppliers as iPhone sales rise. But Cirrus also doesn't have much clout in price negotiations, and its business could be abruptly derailed if Apple switches suppliers or starts developing its own audio chips.
Broadcom is larger and better diversified than many other Apple suppliers, but it still relied on the tech giant for 20% of its revenue last year. Broadcom's chips, which include touch screen controllers, RF front-end modules, Wi-Fi chips, and Bluetooth chips, can be found in iPhones and iPads.
Broadcom's spot in Apple's supply chain is fairly secure compared to those of other suppliers: It signed a deal with Apple at the beginning of 2020 that will generate $15 billion in chip sales over the following three and a half years. Rising sales of iPhone chips could complement the growth of Broadcom's networking and broadband chips to cloud and telco customers, which benefited from stay-at-home trends throughout the pandemic.
If violations are found during our assessments, suppliers are required to fix the issues and take steps to prevent them from happening again. Suppliers found to have serious violations of our standards face immediate consequences including providing remedies to those affected, financial consequences, and probation. Any supplier that is unable or unwilling to meet our standards risks termination of their business with us.
We provide proactive support to suppliers that are implementing recommended local safety protocols during the global health crisis. This includes rearranging factory floor plans to accommodate social distancing, staggering schedules, providing onsite testing, and maintaining thorough deep-cleaning standards. Since this issue is much bigger than our supply chain, we shared our learnings and safety tools with more than 170 companies across industries through the Responsible Business Alliance.
Building innovative products requires working with world-class manufacturing partners and skilled employees. Our suppliers operate some of the most technologically advanced manufacturing facilities on the planet, designed to perform at the level of precision and quality necessary to build our products. For example, we supported a manufacturer in deploying a recovery system to capture heat generated from equipment and convert it to warm water for use in nearby living areas. The new energy management system allowed the supplier to find ways to be more energy efficient, while still performing highly engineered and specified manufacturing processes for Apple.
We partner with our suppliers to help them uphold the highest standards to keep people safe on the job. In 2021 we received the Safer Choice Partner of the Year Award from the U.S. Environmental Protection Agency (EPA) for the second year in a row, in recognition of our work to scale the use of safer cleaners and degreasers in our supply chain. And for the third year running, Apple received an A+ rating from Mind the Store, a ranking that evaluates the largest retailers in North America on how they ensure the chemical safety of their products and packaging. We were also ranked #1 out of the 50 retailers evaluated as part of the Mind the Store Retailer Report Card in 2021.
We believe that equity takes initiative. Last year Apple welcomed the first cohort of participants to our Impact Accelerator for Black- and Brown-owned businesses, as part of our larger Racial Equity and Justice Initiative. The Impact Accelerator expands access to opportunity for suppliers in the U.S. by ensuring that our investments in sectors like renewable energy, carbon removal, and recycling innovation also help fight systemic barriers impacting communities that are disproportionately affected by environmental issues like climate change.
An important part of closing material loops is helping recyclers efficiently and safely recycle our products. To do this, we developed Apple Recycler Guides to provide guidance for professional electronics recyclers on how to safely disassemble Apple products and maximize recovery of resources. While we continue to move toward using recycled and renewable materials, our suppliers are required to source primary minerals responsibly and follow strict environmental and human rights standards.
CUPERTINO, CALIFORNIA Apple today announced that its suppliers more than doubled their use of clean power over the last year, with over 10 gigawatts operational today out of nearly 16 gigawatts in total commitments in the coming years. In 2021, these renewable projects avoided 13.9 million metric tons of carbon emissions. The projects online today will support greenhouse gas reductions equivalent to removing 3 million cars from the road for one year.
In South Korea, LG Display Co. Ltd. and Samsung SDI have committed to clean energy for all Apple production. This addition to the program builds on significant progress over the last year, with a total 13 suppliers committing to bring clean energy online.
Meanwhile, arch-rival Samsung Electronics Co Ltd , with a range of handsets has overtaken Apple as the world's top smartphone seller. If Apple's customers and suppliers, let alone rivals, smell blood and take a much harder line in negotiations, it could erode Apple's gross margins, which slipped to 38.6 percent in the last quarter from 44.7 percent a year ago.
A less powerful Apple could be welcomed by telecommunications carriers and component suppliers that have grown accustomed to the tough terms Apple was able to exact thanks to its massive scale and leadership in the market. Wireless carriers that once agreed to unfavorable contracts and hefty subsidies still cannot live without Apple, but experts say they could have more leeway in the future if Samsung and other device makers continue to grab market share.
To be sure, InvenSense is trying to win Cupertino, California-based Apple's business. But even without Apple, it has become a key supplier in the smartphone and tablet market. But as Samsung's share of the smartphone market grows further, it too is forcing suppliers to accept lower and lower prices, said Evercore Partners analyst Mark McKechnie. "Samsung beats the heck out of people too. Be careful what you wish for," McKechnie said.
James Allworth, Harvard Business School Forum for Growth and Innovation fellow and co-author of How Will You Measure Your Life joins Horace for an in-depth discussion of the vulnerability of Apple to low-end disruption. Specifically, assuming the iPhone reaches a point of over-service, did Apple arm its suppliers with the means to create its replacement? We dip into case studies of Dell, HP, HTC and Microsoft and touch on how iPod escaped this fate.
The portal provides our suppliers with secure access to important processes and tools. Through the platform, active suppliers can access information related to their contracts as well as tools to manage bidding, ordering, delivery and payment activities.
Our Nestlé Responsible Sourcing Standard describes the requirements and ways of working that we apply together with our suppliers to ensure the sustainable long-term supply of materials and services to Nestlé. It sets out basic non-negotiable standards as well as important and urgent sustainability practices that we ask our suppliers, their employees, agents and subcontractors to respect and to adhere to at all times when conducting business.
The Standard is an integral part of all of our purchase orders and supply contracts. Through our Sustainable Sourcing Tier 1 program, we verify compliance with the Standard by our direct suppliers through independent audits carried out by audit firms accredited by Nestlé. These audits follow the SMETA Best Practice Guidance (pdf, 2Mb). If non-compliance issues or gaps are found, a time-bound action plan is developed and implemented by the supplier. The implementation of this plan will be later verified by the auditor. In case a supplier refuses to undergo an audit or to close gaps, we may terminate the business relationship.
In addition to verifying compliance with our direct suppliers, we have identified 14 raw materials that present higher risk of environmental and/or social issues. For those, we work closely with our direct suppliers and partners to conduct a mapping of our upstream supply chains and carry out farm assessments in our upstream supply chain with partner organizations. In many cases, issues are identified that require long-term, tailored interventions to tackle their root causes for greater impact.
A bunch of Apple's other Taiwanese suppliers fell sharply, including camera lens-maker Largan Precision Co Ltd , which was down more than 7 percent, and Flexium Interconnect Inc , which fell 6 percent. The Taiwan Weighted Index was down around 0.9 percent.
Hong Kong-based acoustic components supplier AAC Technologies Holdings Inc fell 7 percent. South Korean electronic parts suppliers Samsung Electro-Mechanics Co Ltd and LG Innotek Co Ltd were down more than 6 percent.
To help suppliers of hyperlocal marketing technologies and services better meet the needs of these national-to-local marketers, Street Fight surveyed over 200 managers and decision makers at big companies in retail, financial services, and other industries. We asked them about spending patterns, perceived effectiveness, pain points, etc., around their local marketing and advertising efforts. The full report is available for download here.
South Korean shares closed at a three-week high thanks to gains in Apple suppliers following the tech giant's near 4 percent rally overnight. LG Dis climbed 1.4 percent while LG Innotek jumped 3.2 percent. 041b061a72