Apple iPhone 7 modem orders could give Intel $1.5 billion revenue boost

Intel will supply nearly 50 percent or more of 7360 LTE modems for the manufacturing of Apple iPhone 7, which could generate Intel $1.5 billion revenue over the next year.

According to Timothy Arcuri, who works for the financial research firm Cowen and Company, Intel will probably provide Apple with over 100 million to 110 million 7360 LTE modems over the iPhone 7 lifespan, which is 25 percent higher than the previous estimates.

Even though the proposed profit of $1.5 billion will largely account for the development costs, nearly $850 million of the overall profit would be the final operational profits. However, these figures are liable to change depending upon the market conditions.

Commenting on the development, Arcuri, citing Intel’s Client Computing Group, revealed that while this is certainly a meaningful number, the final effect for Intel is even greater since it opens up an entirely new non-CCG narrative.

Apple, to diversify its supply chain, has sealed a deal with Intel rather than approaching Qualcomm like in the previous years. Arcuri believes that this change in trend is part of overhauling of product manufacturing strategy that has geared up during the recent years under the leadership of CEO Tim Cook.

In October 2015, few reports emerged that Intel had deployed over 1000 people to work on the Intel’s project to provide a cutting-edge high-speed next-generation LTE modem into iPhone 7 and iPhone 7 Plus.

Apple also shipped out few high performing engineers based out of the Intel’s German facilities to oversee the production of the modem for the upcoming iPhone 7. In the meantime, Apple also hired key personnel from Infineon 7360 development team.

In future, Intel will take advantage of the existing deal to integrate its modem technology directly into Apple’s A-series processor. By bringing both the processor and modem chipset into a single platform, Apple will be able to deliver high-quality performance coupled with higher operating efficiency and lower manufacturing costs.

Expected to be unveiled in September, the iPhone 7 will be manufactured with enhanced internals and minor design tweaks. On the specifications front, the iPhone 7 is expected to feature a 4.7-inch OLED display, 32GB of default storage space paired with a larger rear-facing camera and modified antenna lines.

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