Apple stock has been hammered all week, in the aftermath of the Japan earthquake, and that trend continues on Friday, in early morning (PT) trading. Why would Apple stock drop in the wake of an iPad 2 hit? The reason: Apple already has iPad 2 supply problems, and the Japan earthquake is expected to exacerbate the issue.
In fact, on Thursday, iSuppli posted a press releaseindicating that the iPad 2 may indeed face such supply problems, based on iSuppli's earlier teardown.
iSuppli typically tears down hot devices, so that it can estimate the cost to the manufacturer, and thus determine the profitability of a device. It recently tore down the iPad 2, and as such, has a keen insight into the iPad 2's parts.
iSuppli's teardown of the iPad 2 has identified five parts that Apple sources from Japanese suppliers: NAND flash from Toshiba (used for storage), dynamic random access memory (DRAM) made by Elpida, an electronic compass from AKM Semiconductor, the touch screen overlay glass likely from Asahi Glass Co. and the system battery from Apple Japan. iSuppli notes that there are potentially other parts that might be sourced from Japan, as not all parts can have their manufacturer of origin IDed in a teardown.
Note that the key word in the press release is "potentially." For example, the NAND flash can obviously be sourced from other manufacturers, such as Korea's Samsung and the U.S.' Micron. In fact, given Apple's hold over global NAND flash supply, this might affect other device manufacturers such as Motorola more. Similarly, the Elpida DRAM component can be alternatively sourced from Samsung and others.
The compass, the glass, and the battery itself may pose greater problems for Apple. Compasses are not interchangeable in the way that NAND Flash is, for a variety of reasons. And, while the supplier of the iPad 2's display glass was not confirmed by iSuppli with certainty, speculation is that Asahi may be the supplier. Asahi Glass reported damage to three of its facilities.
The lithium-ion polymer battery in the iPad 2, although it says "assembled in China," is also manufactured in Japan, according to iSuppli. The battery itself is made by Apple Japan, which is an Apple subsidiary.
Additionally, it's not just about the manufacturer of a particular component of the iPad 2. It is als about these manufacturers' ability to get the raw materials for their parts. Logistics, meaning the ability to obtain these materials and transport them to and from the facilities, is as important as the health of the facilities themselves.
In early morning PT trading on Friday, Apple had dropped about $25 from Monday's price, all the way to $331.87.
In fact, on Thursday, iSuppli posted a press releaseindicating that the iPad 2 may indeed face such supply problems, based on iSuppli's earlier teardown.
iSuppli typically tears down hot devices, so that it can estimate the cost to the manufacturer, and thus determine the profitability of a device. It recently tore down the iPad 2, and as such, has a keen insight into the iPad 2's parts.
iSuppli's teardown of the iPad 2 has identified five parts that Apple sources from Japanese suppliers: NAND flash from Toshiba (used for storage), dynamic random access memory (DRAM) made by Elpida, an electronic compass from AKM Semiconductor, the touch screen overlay glass likely from Asahi Glass Co. and the system battery from Apple Japan. iSuppli notes that there are potentially other parts that might be sourced from Japan, as not all parts can have their manufacturer of origin IDed in a teardown.
Note that the key word in the press release is "potentially." For example, the NAND flash can obviously be sourced from other manufacturers, such as Korea's Samsung and the U.S.' Micron. In fact, given Apple's hold over global NAND flash supply, this might affect other device manufacturers such as Motorola more. Similarly, the Elpida DRAM component can be alternatively sourced from Samsung and others.
The compass, the glass, and the battery itself may pose greater problems for Apple. Compasses are not interchangeable in the way that NAND Flash is, for a variety of reasons. And, while the supplier of the iPad 2's display glass was not confirmed by iSuppli with certainty, speculation is that Asahi may be the supplier. Asahi Glass reported damage to three of its facilities.
The lithium-ion polymer battery in the iPad 2, although it says "assembled in China," is also manufactured in Japan, according to iSuppli. The battery itself is made by Apple Japan, which is an Apple subsidiary.
Additionally, it's not just about the manufacturer of a particular component of the iPad 2. It is als about these manufacturers' ability to get the raw materials for their parts. Logistics, meaning the ability to obtain these materials and transport them to and from the facilities, is as important as the health of the facilities themselves.
In early morning PT trading on Friday, Apple had dropped about $25 from Monday's price, all the way to $331.87.
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