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Loss of Apple’s processor business unlikely to affect Samsung

Dan Graziano
December 28th, 2012 at 5:35 PM
Samsung Apple Components Shift

Despite being estimated to pull in some $13 billion in revenue next year from its various parts deals with Apple (AAPL), the loss of the company’s processor business is unlikely to affect Samsung (005930). The partners have become bitter rivals as competition between the two has increased over the past two years. After a number of legal complaints, Apple has reportedly begun to shift away from Samsung components, including processors, batteries and displays. A complete shift from the company’s parts is estimated to take anywhere from 12 to 18 months, however Samsung is expected to see little or no adverse impact.

Digitimes Research notes that the company is expected to “sustain its growth momentum” particularly due to the strong sales of its smartphones and tablets, as well as other portable consumer products. It is also believed that if Apple withdraws its orders, Samsung will be able shift more resources to producing chips for its own mobile devices in the upcoming year.

Mark Newman of Bernstein Research perviously determined that if Apple were to shift its dependence from Samsung, the downside would be minimal. The analyst estimated that the company would only take a 3% revenue hit in the worst-case scenario, that is of course if Apple’s business “cannot be filled by other businesses.”

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