News Worms
News Worms

Dialog maintains guidance amid worries of Apple problems

Dialog maintains guidance amid worries of Apple problems

A source familiar with the matter confirmed to Reuters that Apple was recruiting top Dialog engineers in Munich. AAPL chip maker Dialog Semiconductor Plc DLG.F plummeted as much as 30% Tuesday after an analyst downgraded the stock, noting that Dialog could potentially lose its Apple contracts as early as 2019. Morgan Stanley believes Dialog entered into a partnership with Apple to design a wireless charging system.

Imagination shares have since rebounded, but they remain 60% below where they started the year.

The prediction comes from analyst Karsten Iltgen at German investment bank Bankhaus Lampe, who said that Apple will at the very least cut back to some degree on Dialog's supply of power management chips for the iPhone, according to a research note obtained by Bloomberg. Dialog stock plunged more than 14% in Germany.

A few investigators don't trust that it will ever go to that and can't help contradicting Iltgen's expectation, as Barclays examiner Andrew Gardiner as of late said in his exploration that he does not view Dialog remotely in a comparative position as Imagination. 'They are poaching like insane, ' the person said.

The main loser in the news is Dialog Semiconductor, the British company that previously supplied power management chips to Apple. However, Apple is no stranger to custom silicon as it has designed its own A-series iPhone and iPad processors for many generations. It follows Apple's decision to build its own iPhone graphics processors in a decision which has crippled another United Kingdom company, Imagination Technologies. Its plans to buy US -based Atmel in 2015 were derailed after Microchip (MCHP.O) swooped in with a higher bid. It isn't unusual to see employers flowing between Apple, and it's suppliers.

Even if it does not manage to make the chips itself, it can always threaten its existing suppliers with the move.

These single chip arrangements make use of optimized power consumption technology and give a basic, yet adaptable, plan at a lower cost.

Industry peer AMS also came under pressure after UBS cut its rating to "neutral" from "buy", sending the stock down 7.1 percent, while STMicroelectronics fell 2.6 percent.


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