Apple contract worth US$2.1 billion to Samsung this year

Karen Haslam
10 August, 2012
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Samsung could regret its courtroom dispute with Apple, as Apple is Samsung’s biggest customer and its business is worth 8.8% of Samsung’s revenue.

Samsung is the manufacturer of the A-series of processors – the A4 and A5 chips that Apple designs in-house and uses as the heart of the iPad and iPhone.

Gartner estimates that Apple will spend around US$2.1 billion on these A-series chips this year, according to a Bloomberg report.

There has been speculation that Apple will replace Samsung with Taiwan Semiconductor Manufacturing Company – but according to reports TSMC can’t yet match the numbers required each month. Qualcomm, who provides baseband radio chips for the iPhone, also uses TSMC.

It is also suggested that changing the supplier will involve a significant redesign from Apple’s perspective.

DigiTimes had previously reported that Apple is tied into a contract with Samsung regarding the A6 processor, and won’t be able to drop its chip orders until 2014.

When Apple was reported to have secured chips from Elpida, the news wiped US$10 billion of Samsung’s market cap, however, Samsung denied that the claims that Apple had stopped its orders.

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