Did Apple Spend $2 Billion to Bail Out Sharp?
Apple analyst Horace Dediu has dug deep into Apple's 2012 capital expenditures and found some spending, above and beyond what Apple had previously disclosed. He discovered that Apple spent $2.3 billion more than it had forecast on "product tooling, manufacturing process equipment and infrastructure".
![sharplogo.jpg Sharplogo](https://cdn.statically.io/img/images.macrumors.com/t/gYCh36EbSLFDta_v4GJL3diKrPU=/400x0/article-new/2012/11/sharplogo.jpg?lossy)
However, Apple didn't actually shell out cash for its increase in CapEx, but instead is booking vendor financing. Dediu believes it may have been to bail out Sharp, which was in dire financial straits earlier this year.
Circumstantial evidence points to the asset being production equipment (or even a whole plant) previously owned by Sharp. Sharp is a key supplier of screens to Apple but is also in financial distress. Sharp has also been the object of an intended investment by Foxconn [Hon Hai]. That deal fell through as Sharp’s finances deteriorated. My guess is that these attempts to shore up Sharp are directed by Apple to ensure both continuity of supply and a balanced supplier base (offsetting Samsung, another supplier.) If Sharp were to enter into some form of bankruptcy, the key plant(s) used in producing screens for Apple might be "up for grabs" by creditors and they might be taken off-line, jeopardizing Apple’s production capacity, irrespective of contractual obligations. I believe that Apple’s late and unprecedented expenditure was to secure this asset. I further believe that the financing for this deal was done through a swap of "pre-orders".
Dediu has much more on the spending and his analysis at Asymco.
Popular Stories
Apple will adopt the same rear chassis manufacturing process for the iPhone SE 4 that it is using for the upcoming standard iPhone 16, claims a new rumor coming out of China. According to the Weibo-based leaker "Fixed Focus Digital," the backplate manufacturing process for the iPhone SE 4 is "exactly the same" as the standard model in Apple's upcoming iPhone 16 lineup, which is expected to...
Apple typically releases its new iPhone series around mid-September, which means we are about two months out from the launch of the iPhone 16. Like the iPhone 15 series, this year's lineup is expected to stick with four models – iPhone 16, iPhone 16 Plus, iPhone 16 Pro, and iPhone 16 Pro Max – although there are plenty of design differences and new features to take into account. To bring ...
A widespread system failure is currently affecting numerous Windows devices globally, causing critical boot failures across various industries, including banks, rail networks, airlines, retailers, broadcasters, healthcare, and many more sectors. The issue, manifesting as a Blue Screen of Death (BSOD), is preventing computers from starting up properly and forcing them into continuous recovery...
Israel-based mobile forensics company Cellebrite is unable to unlock iPhones running iOS 17.4 or later, according to leaked documents verified by 404 Media. The documents provide a rare glimpse into the capabilities of the company's mobile forensics tools and highlight the ongoing security improvements in Apple's latest devices. The leaked "Cellebrite iOS Support Matrix" obtained by 404 Media...
Apple is seemingly planning a rework of the Apple Watch lineup for 2024, according to a range of reports from over the past year. Here's everything we know so far. Apple is expected to continue to offer three different Apple Watch models in five casing sizes, but the various display sizes will allegedly grow by up to 12% and the casings will get taller. Based on all of the latest rumors,...
If you have an old Apple Watch and you're not sure what to do with it, a new product called TinyPod might be the answer. Priced at $79, the TinyPod is a silicone case with a built-in scroll wheel that houses the Apple Watch chassis. When an Apple Watch is placed inside the TinyPod, the click wheel on the case is able to be used to scroll through the Apple Watch interface. The feature works...