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Samsung: We Agreed on Processor Prices with Apple Earlier This Year

by Todd Haselton | November 14, 2012November 14, 2012 11:00 am PDT

A report recently surfaced suggesting that Apple was paying 20 percent more for processors provided by Samsung because it couldn’t find another firm in time to replace the Korea tech giant. That’s not the full story, Samsung says. In fact, The Hankyoreh cited an unnamed Samsung exec on Wednesday who said┬áSamsung and Apple agreed on prices at the beginning of the year and that they have not changed.

Piper Jaffray analyst Gene Munster told The Street┬áthat he estimates the increased price could have cut Apple’s gross margins by one to two percent. Munster also backs up other reports that Apple will likely lean on Taiwan Semiconductor Manufacturing Company (TSMC) for chips in the future. “We believe that if Apple were to move to another vendor in the next year or two, they may be able to negotiate better chip prices, which would roll back the impact from the Samsung price increase.”

In other words, the 20 percent price hike didn’t actually happen.

[via The Street, The Hankyoreh]


Todd Haselton

Todd Haselton has been writing professionally since 2006 during his undergraduate days at Lehigh University. He started out as an intern with...

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