Apple "surprised" by supplier bankruptcy

Apple has expressed surprise at sapphire screen supplier GT Advanced Technologies' (GTAT) decision to file for bankruptcy on Tuesday. However, it seems its own decision to withhold US$139 million could be in part to blame.

Apple told The Wall Street Journal: "We are focused on preserving jobs in Arizona [where the plant is located] following GT’s surprising decision and we will continue to work with state and local officials as we consider our next steps."

It wasn't just Apple that was taken aback either, the WSJ claims, saying other investors, creditors and partners were also left "stunned".

GTAT was contracted by Apple to produce sapphire screens, which were expected to feature on its iPhone 6 and iPhone 6 Plus smartphones. However, when they launched, neither device featured the supposedly super-hard material.

According to VentureBeat, GTAT's sapphire shattered repeatedly during the company's standard drop test, causing a switch to ion-toughened glass instead.

Apple then withheld the final US$139 million tranche of a US$578 million funding agreement, which it was supposed to hand over at the end of the month. This, according to 9to5Mac, is what caused GTAT to go into financial distress.

Nevertheless, in a statement yesterday, GTAT said it expected to be given permission to "conduct business as usual" during the proceedings.

What about the Apple Watch?

GTAT's bankruptcy has raised questions over production of the Apple Watch, as it was thought the company may be producing sapphire screens for that device as well.

However, according to MacRumours, analyst and Apple watcher Ming-Chi Kuo of KGI securities has suggested the smartwatch's production won't be affected by the bankruptcy.

Kuo believes that, as the screen for the Apple Watch is much smaller and doesn't have to be as tough as the iPhone's, the company has the option to turn to other suppliers if necessary.

"There are abundant sapphire ingot suppliers to choose from for Apple Watch. According to our survey, aside from GTAT, other Apple Watch sapphire ingot suppliers are Hansol (KR) and Harbin Aurora Optoelectronics (CN)," he said.
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This article originally appeared at pcpro.co.uk