Apple's Arizona Sapphire Facility 'Commencing the Transition to Volume Production'

[MacRumors]

Apple's sapphire partner GT Advanced Technologies today announced financial results for the second quarter of 2014, acknowledging publicly that the companies' facility in Mesa, Arizona is "commencing the transition to volume production."

"The build-out of our Arizona facility, which has involved taking a 1.4 million square foot facility from a shell to a functional structure as well as the installation of sapphire growth and fabrication equipment, is nearly complete and we are commencing the transition to volume production," Gutierrez continued. "We remain confident about the long-term potential of the sapphire materials business for GT.

Overall, GT reported a net loss of $86 million for the quarter, a result that is not unexpected given that the company is significantly restructuring itself as part of the Apple deal, essentially shutting down its sales of sapphire furnaces to other customers in order to devote all of those resources to setting up the Arizona facility for Apple. The facility is owned by Apple and being run by GT, with Apple providing some upfront financing to help get production rolling.

GT allocated over $45 million to "sapphire production ramp up costs" during the quarter, with the company stating that those costs relate to "production inefficiencies and inventory losses" associated with building out its facilities and are not part of ongoing operations for the company. That amount is up from just $1.9 million in the prior quarter, signaling the company's massive move to launch production for Apple.

GT also confirmed that it expects to meet the targets outlined in its deal with Apple, allowing to receive the final $139 million prepayment from Apple by the end of October.

Apple has used sapphire for the camera lens cover on several iOS devices and for the Touch ID sensor on the iPhone 5s, but the company is pursuing a massive increase in sapphire usage for future products. The iPhone 6 display has been rumored to include a sapphire cover, but rumors are divided on whether the material will be included on all models or just higher-end models, as well as whether the entire cover will be full sapphire or a thinner lamination layer.

Apple's rumored iWatch has also been speculated to include a sapphire cover, as the material is fairly common on high-end watches to minimize scratching.

(Image: GT sapphire furnace)

Article Link: Apple's Arizona Sapphire Facility 'Commencing the Transition to Volume Production'

 

[iamMacPerson]

I hope this means both the 4.7" and 5.5" iPhones get sapphire glass displays along with the iWatch.

 

[dlewis23]

Can't wait to see how well this sapphire works on the next iPhone.

 

[TWSS37]

Ladies and gentlemen, here is your annual iPhone shortage production constraint

 

[CrazyForApple]

Sapphire Sapphire Sapphire... Any other news?

 

[Azzin]

In before "There's no 5.5" iPhone, so it can't be for that".

 

[pedromcm.pm]

Thoughts?

I find those haters that praise companies like Samsung and attack Apple at every opportunity, and trolls that are so blind to their devotions that they go to the extent to suggest that Apple is in trouble/Apple is never wrong/Android and Windows are better.

I just found it laughable.

However, I believe that people (and the press, shareholders, etc.) should pressure Apple to do more stuff like this.

Basically, with few hundred million dollars, they cornered the Saphire market and will only profit directly (their products) or indirectly (selling Saphire to others).

Why isn't Apple doing the same with Tesla's Gigafactory? Why isn't Apple investing in "power" (general resources, green energy, sell it)? Heck, not even a bank-like operation with so many cash?

Visa would quickly **** their pants.

If every initiative went wrong, Apple would recover in 1 month, while getting a lot of potential extra billion dollars each quarter and not depending as much on hardware sales.

Then again, what do I know? I'm nobody. Yet.

 

[MyDataMyProbs]

HENCE.. why the 5.5 will NOT debut the same time as the 4.7

5.5 will indeed have Sapphire. Done.

 

[zippyzoom]

GTAT in the green AH Shorties will be forced to cover tomorrow AM

 

[MyDataMyProbs]

If every initiative went wrong, Apple would recover in 1 month, while getting a lot of potential extra billion dollars each quarter and not depending as much on hardware sales.

Its almost scary to think Apple could potentially have the worlds largest monopoly. because like you said, if the investment went south - the hundred +/- Million dollars would be recovered extremely quickly; however, if the car was forward thinking as the rest of their products Apple would have a hand in automotive, construction, and probably energy. perhaps own the stations the power the cars they produce. it would be Apple eventually buying an island and become a country. LOL.

 

[Azzin]

I find those haters that praise companies like Samsung and attack Apple at every opportunity, and trolls that are so blind to their devotions that they go to the extent to suggest that Apple is in trouble/Apple is never wrong/Android and Windows are better.

I just found it laughable.

However, I believe that people (and the press, shareholders, etc.) should pressure Apple to do more stuff like this.

Basically, with few hundred million dollars, they cornered the Saphire market and will only profit directly (their products) or indirectly (selling Saphire to others).

Why isn't Apple doing the same with Tesla's Gigafactory? Why isn't Apple investing in "power" (general resources, green energy, sell it)? Heck, not even a bank-like operation with so many cash?

Visa would quickly **** their pants.

If every initiative went wrong, Apple would recover in 1 month, while getting a lot of potential extra billion dollars each quarter and not depending as much on hardware sales.

Then again, what do I know? I'm nobody. Yet.

Perhaps they don't want to be a jack of all trades, master of none, type operation?

 

[Mad Mac Maniac]

So excited about getting my iPhone 6!

 

[FieldingMellish]

Wasn’t Sapphire the wife of Kingfish?

 

[Ries]

I find those haters that praise companies like Samsung and attack Apple at every opportunity, and trolls that are so blind to their devotions that they go to the extent to suggest that Apple is in trouble/Apple is never wrong/Android and Windows are better.

I just found it laughable.

However, I believe that people (and the press, shareholders, etc.) should pressure Apple to do more stuff like this.

Basically, with few hundred million dollars, they cornered the Saphire market and will only profit directly (their products) or indirectly (selling Saphire to others).

Why isn't Apple doing the same with Tesla's Gigafactory? Why isn't Apple investing in "power" (general resources, green energy, sell it)? Heck, not even a bank-like operation with so many cash?

Visa would quickly **** their pants.

If every initiative went wrong, Apple would recover in 1 month, while getting a lot of potential extra billion dollars each quarter and not depending as much on hardware sales.

Then again, what do I know? I'm nobody. Yet.

Remember Nokia? They owned the phone market until they ****ed up. Their peak value in todays dollars would be ~375B dollars, the value of Apple a year ago.

 

[TheHateMachine]

I find those haters that praise companies like Samsung and attack Apple at every opportunity, and trolls that are so blind to their devotions that they go to the extent to suggest that Apple is in trouble/Apple is never wrong/Android and Windows are better.

I just found it laughable.

However, I believe that people (and the press, shareholders, etc.) should pressure Apple to do more stuff like this.

Basically, with few hundred million dollars, they cornered the Saphire market and will only profit directly (their products) or indirectly (selling Saphire to others).

Why isn't Apple doing the same with Tesla's Gigafactory? Why isn't Apple investing in "power" (general resources, green energy, sell it)? Heck, not even a bank-like operation with so many cash?

Visa would quickly **** their pants.

If every initiative went wrong, Apple would recover in 1 month, while getting a lot of potential extra billion dollars each quarter and not depending as much on hardware sales.

Then again, what do I know? I'm nobody. Yet.

The only thing that is certain is death and taxes. It would be foolish to say that Apple could do anything and recover from any disaster or blunder. You never know what could be right around the corner.

trolls that are so blind to their devotions

Remember Nokia? They owned the phone market until they ****ed up. Their peak value in todays dollars would be ~375B dollars, the value of Apple a year ago.

Many companies have been rolling in the cash and plowing through history like a freight train only to get caught up in a quagmire and either went away in the night or greatly diminished. Nothing is infallible, yet some would have you believe that Apple is.

 

[pedromcm.pm]

Its almost scary to think Apple could potentially have the worlds largest monopoly. because like you said, if the investment went south - the hundred +/- Million dollars would be recovered extremely quickly; however, if the car was forward thinking as the rest of their products Apple would have a hand in automotive, construction, and probably energy. perhaps own the stations the power the cars they produce. it would be Apple eventually buying an island and become a country. LOL.

It's not scary. Industries with lots of players doing well (energy (renewable or not), automotive, construction, banks, ISPs) are industries where innovation died long ago.

It happened with the music industry, phones, PCs, etc. Thanks to Apple, costumers had a lot to gain, even if they chose products from other companies.

Perhaps they don't want to be a jack of all trades, master of none, type operation?

I don't understand your post.

People that are serious about software should do the hardware, right? Why stop there? If you are serious about battery life on your devices, do them yourself! That's my point.

Remember Nokia? They owned the phone market until they ****ed up. Their peak value in todays dollars would be ~375B dollars, the value of Apple a year ago.

Nokia was never as lucrative, as powerful, as influential, as determinant, as Apple is. No one in the tech industry was.

The way things are, if you see an innovative product coming from someone, it has to be from Apple. No one can do it. No one.

Why? With races to the bottom and the current ecosystem wars, a new innovative category is only possible if it quickly sells in the millions and millions (only Apple and Samsung have the supply chain expertise for such global sales) of units (otherwise it isn't even remotely profitable.), and it will only sell those units if it has a strong ecosystem behind its back (only Apple and Google).

Google doesn't have the muscle, Samsung doesn't have the brain. Everybody else is irrelevant for this metric and only Apple has both.

So yeah, maybe someday Apple slows down, copy this feature, iterate that feature, but it isn't possible for anyone to still their throne as the one (or close) of the most lucrative public traded companies in the world.

So, again: A company like Tesla won't change the world, even with more 10 Elon Musks and more 20 years. But Apple could enter that game, help, sell batteries, profit a lot from it, and create better batteries for their products.

They don't have to make cars to profit from that Gigafactury. Get it? I'm I wrong?

 

[Michael Scrip]

Just curious... do any other mobile device manufacturers use sapphire in their products?

Apple is already using sapphire in the camera cover and the TouchID cover... but they're clearly getting ready for something bigger.

It doesn't seem like anyone else has even considered it.

But if sapphire does become prevalent across the industry... I wonder if people will simply say it was just "natural progression" and forget about Apple's huge initial investment.

Apple is rarely first with anything... but they do have some great ideas. Sometimes Apple doesn't get the credit they deserve when they try something new... instead people say "it would have happened eventually"

Is sapphire one of those things that Apple just happened to bring to market before everyone else could? Was Apple's timing just a coincidence?

 

[pedromcm.pm]

Just curious... do any other mobile device manufacturers use sapphire in their products?

Apple is already using sapphire in the camera cover and the TouchID cover... but they're clearly getting ready for something bigger.

It doesn't seem like anyone else has even considered it.

But if sapphire does become prevalent across the industry... I wonder if people will simply say it was just "natural progression" and forget about Apple's huge initial investment.

Apple is rarely first with anything... but they do have some great ideas. Sometimes Apple doesn't get the credit they deserve when they try something new... instead people say "it would have happened eventually"

Is sapphire one of those things that Apple just happened to bring to market before everyone else could? Was Apple's timing just a coincidence?

Apple never made a "huge" investment in saphire. It was pennies for them.
They made a very smart, brilliant, move.

 

[agsystems]

Ladies and gentlemen, here is your annual iPhone shortage production constraint

Not based on GTAT's guidance - unless they are lying

They are planning to book 600m-800m in sales in the 4th quarter ending Dec 31th so looks like they will have enough to satisfy Apple's launch numbers (Sept-Nov).


http://investor.gtat.com/releasedetail.cfm?ReleaseID=864032

 

[Michael Scrip]

Apple never made a "huge" investment in saphire. It was pennies for them.

They made a very smart, brilliant, move.

Well yeah... Apple has enough money to buy a small country

What I meant was... Apple spent a lot of time (and some money) on sapphire... while no one else seemed to care.

If sapphire ever becomes commonplace... I wonder if people will remember Apple's part in that.

 

[pedromcm.pm]

Well yeah... Apple has enough money to buy a small country

What I meant was... Apple spent a lot of time (and some money) on sapphire... while no one else seemed to care.

If sapphire ever becomes commonplace... I wonder if people will remember Apple's part in that.

Oh, they will, just like with touchscreens.

"it was obvious"
"they tried to keep the tech for themselves."
"patented Saphire. lol"

Let's ignore how we own the modern touchscreen paradigm to Apple ALONE. If it wasn't for them, people would still be using Blackberry Bold.

 

[Enabledobject]

In before "There's no 5.5" iPhone, so it can't be for that".

Haha! You were more quick on the draw this time.

 

[Flying Wall E]

I find those haters that praise companies like Samsung and attack Apple at every opportunity, and trolls that are so blind to their devotions that they go to the extent to suggest that Apple is in trouble/Apple is never wrong/Android and Windows are better.

I just found it laughable.

However, I believe that people (and the press, shareholders, etc.) should pressure Apple to do more stuff like this.

Basically, with few hundred million dollars, they cornered the Saphire market and will only profit directly (their products) or indirectly (selling Saphire to others).

Why isn't Apple doing the same with Tesla's Gigafactory? Why isn't Apple investing in "power" (general resources, green energy, sell it)? Heck, not even a bank-like operation with so many cash?

Visa would quickly **** their pants.

If every initiative went wrong, Apple would recover in 1 month, while getting a lot of potential extra billion dollars each quarter and not depending as much on hardware sales.

Then again, what do I know? I'm nobody. Yet.

Thinking like that you'll keep being "nobody", as you say, for a while.

Having knowledge on any matter is vital to form any sort of informed opinion before sugesting something like "Apple should branch out and add a "bank-like" operation". I don't even know what to say to that... Your post left me at a loss for words. There are so many reasons and arguments that should have crossed your mind and prevented even the concept of that idea from ever forming... I was already tired, it was a long day, now I'm exhausted. I think the feeling is incredulity. Well have a nice evening or whatever is more appropriate accordingly to your time zone.

 

[rdlink]

I'm almost thinking that this indicates no sapphire on the iPhone 6, and that the sapphire is being manufactured for a later product. If they are still ramping up production how can they be churning out enough for phones that are rumored to be in production already?

 

[Erasmus]

OK, I'll go there...

Sapphire iPad Mini???