Accessible version Technology - Asia Pacific (H/A) Apple supply chain: multi-year upgrade cycle to support share-price momentum Price Objective Change Supply chain check: flattish new model stocking Our checks reveal 2H25 new model stocking is at slightly above 90mn units, largely similar to last year's 90-95mn units. Also, we believe the market's previous bearish view (-5-10% YoY) has partially eased, following relieved tariffs around Apple products (see report). To cross check, key suppliers Largan/Zhen D ...

Summary of Key Points from J.P. Morgan's iPhone EMS Build Plan Company and Industry - **Company**: Apple Inc. - **Industry**: Technology, specifically focusing on smartphone manufacturing and supply chain dynamics Core Insights and Arguments 1. **Revised iPhone EMS Build Estimates**: The 2H25 iPhone EMS build plan estimates have been increased to 247 million units from a previous estimate of 235 million units, reflecting a 5% increase [6] 2. **Factors Driving Upward Revision**: - Removal of tariff concerns is a significant factor contributing to the upward revision [6] - Anticipation that China will allow eSIM for iPhone Slim/Air, potentially boosting demand in China [6] 3. **Long-term Shipment Outlook**: The company remains optimistic about long-term shipments, expecting Apple to introduce more iPhone models with new form factors, including the iPhone 17 series in 2H25 and a foldable iPhone in 2H26 [1][6] 4. **iPhone 17 Series Build Estimates**: The iPhone 17 series build estimate for 2H25 has been raised to 94 million units, indicating flat year-over-year growth compared to the iPhone 16 series build in 2H24 [6] 5. **Quarterly Build Projections**: - 3Q25 is projected at 59 million units and 4Q25 at 84 million units, reflecting a 1% year-over-year growth for 2H25 [6] 6. **Optical Components Outlook**: The report suggests that optical components will see stronger earnings due to specification improvements, with Largan being a preferred pick due to gradual lens spec improvements [6] Additional Important Insights 1. **Future iPhone Roadmap**: The anticipated launch of new iPhone models includes: - iPhone 17e in 1H26 - Foldable iPhone in 2H26 - iPhone 18e and base model in 1H27 [1] 2. **Impact of Tariff Exemptions**: The potential tariff exemption due to Apple's significant investment in the U.S. is expected to positively influence the build estimates [6] 3. **China's eSIM Ban**: The possible removal of the eSIM ban in China is seen as a critical factor for increasing demand for the iPhone Slim, which exclusively uses eSIM technology [6] 4. **Analyst Recommendations**: The report emphasizes a selective approach towards Apple supply chain names, highlighting Largan and Genius for their product diversification and expected performance improvements [6] This summary encapsulates the key points from the J.P. Morgan report regarding Apple's iPhone EMS build plan and the broader implications for the technology industry.