Apple Watch Series 3 Success May Increase Upstream Supply Chain

Apple is reportedly planning to increase its upstream supply chain for the Apple Watch following the success of the smartwatch in the fiscal quarter that ended on Sept. 30. The move is said to increase the profitability of the wearable.

On Monday, DigiTimes learned that Apple is now expected to increase the number of its upstream supply chain partners for the Apple Watch. Market watchers are predicting this to happen because the Cupertino giant has reportedly seen an over 50 percent sequential increase the the sales of the Apple Watch in the third quarter. It wasn’t clear how many units of the Apple Watch Series 3 were included in the figure, considering that the 2017 installment just launched on Sept. 22.

Apple is believed to be shipping at least 25 million units of the Apple Watch smartwatch in 2018. Industry sources said that most of these units will go to first-time buyers and not merely consumers who had bought the previous iterations of the series. It can be noted that prior to the release of the Series 3 smartwatch, KGI Securities analyst Ming-Chi Kuo estimated that the demand for the device with cellular capability will be stronger than expected, according to Apple Insider.

During Apple’s earnings call last week, CEO Tim Cook announced that the Apple Watch series has indeed seen unit growth of over 50 percent in the third quarter. At the time, Cook even claimed that the company’s smartwatch “continues to be the best selling and most loved smartwatch in the world.” This is because the Cupertino giant’s entire wearables business was up 75 percent year over year in the fourth quarter and in fiscal 2017, as pointed out by MacRumors.

At present, Apple’s upstream suppliers for the Apple Watch include Quanta Computer, Career Technology, Universal Scientific Industrial (USI), Kinsus Interconnect Technology and E&R Engineering. Industry sources said that all of these upstream players will see increasing orders for the latest smartwatch model.

Foxconn Group affiliate ShunSin Technology has also become part of the upstream suppliers. In fact, the company has already landed orders for providing SiP (system in package) packaging services to Apple Watch. The company is said to commence its work for the Apple smartwatch in March 2018. Unfortunately, ShunSin, as well as the rest of the upstream supply chain players, declined to comment on what the market watchers predicted.

The news about the possible increase in Apple Watch upstream supply chain partners comes amid consumer complaints that both the LTE and non-LTE models of the Apple Watch Series 3 are crashing when asked for a weather update. Many users took to Reddit to complain about the problem with the high-tech timepiece. Most claimed that their device crashed when asked “How is the weather for today?”

As per Trusted Reviews, the issue is not likely attributed to a fault in the Apple Watch Series 3 devices. Instead, the problem is said to be stemming from a watchOS or a server side issue with Siri due to time changes. This is because some users have discovered that the bug is related to the end of Daylight Saving Time. Apple has yet to confirm anything though.