The bankruptcy of GT Advanced Technologies, Apple’s sapphire crystal provider, is unlikely to affect the Apple Watch, which is set to be launched early next year. It is, however, expected to bring more uncertainty to the matter of future iPhone models’ being covered in sapphire.
This is according to noted KGI Securities analyst Ming-Chi Kuo (via MacRumors):
Bankruptcy has no impact on Apple Watch. As the Apple Watch sapphire cover lens uses an ingot of less than 6-inches, and as drop-test requirements aren’t so stringent as those of iPhone, general ingot manufacturing processes such as KY suffice for Apple Watch. This is why there are abundant sapphire ingot suppliers to choose from for Apple Watch. According to our survey, aside from GTAT, other Apple Watch sapphire ingot suppliers are Hansol (KR) and Harbin Aurora Optoelectronics (CN). We therefore don’t think GTAT’s bankruptcy will affect sapphire ingot supply to Apple Watch.
But the use of sapphire cover lens on the touch panels of future iPhones is thrown into question by GT’s bankruptcy. Kuo notes that Apple may opt to coat iPhone displays using sapphire produced by other suppliers, although the company prefers GT’s sapphire supply on account of its superior drop-test performance.
Apple was expected to use sapphire for the displays of the iPhone 6 and the iPhone 6 Plus, but it ultimately didn’t make the cut.
GT announced yesterday that it had filed for bankruptcy. The filing secured court protection under Chapter 11 for the company as it set out to continue doing business while negotiating with creditors.
Earlier today, it was reported that Apple, for yet unknown reasons, held back on paying GT $139 million prior to the sapphire maker’s bankruptcy filing.