LONDON – Apple Inc. became the largest buyer of chips in 2010, overtaking Hewlett-Packard Co. by spending $17.5 billion to grab nearly 6 percent of global production, according to market research firm IHS-iSuppli.
Apple's chip purchasing was up 79.6 percent from $9.7 billion in 2009. In that year Apple had been in third place behind HP and Samsung. It was sixth in 2008, IHS said.
Apple spent more than 61 percent of its 2010 semiconductor budget on chips for wirelessly connected equipment such as iPhones and iPads. In contrast HP spent 82 percent of its 2010 chip-buying budget on chips for notebooks, desktop and server computers. This is clearly working to Apple's benefit. Smartphone shipments increased 62 percent in 2010 and tablet computer shipments exploded by 900 percent, driven by the debut of the iPad. Meanwhile global PC shipments, not counting tablets, grew by 14.2 percent in 2010, said IHS.
Top 10 OEM semiconductor buyers in 2009, 2010 and forecast for 2011, ranked by spending in billions of U.S. dollars.
As a result Apple is expected to keep on increasing its semiconductor spending during the coming years at an above-average pace. In 2011 Apple’s semiconductor spending is expected to exceed that of Hewlett-Packard by $7.5 billion, up from $2.4 billion in 2010.
"Apple's surge to leadership in semiconductor spending in 2010 was driven by the overwhelming success of its wireless products, namely the iPhone and the iPad," said Wenlie Ye, Analyst for IHS, in a statement. "These products consume enormous quantities of NAND flash memory, which is also found in the Apple iPod. Because of this, Apple in 2010 was the world’s number one purchaser of NAND flash."
PS- I also asked IHS about situations like Samsung building chips for its own electronics products. This was the response:
"Our data does include the internal purchase of Samsung semiconductors to build Samsung branded devices."
Apple is truly Amazing. But does this include the costs of semiconductor devices made by the company itself? For eg, If Samsung is using their own Nand flash for their devices, is that counted in this?
Not surprising. Only hi-tech company that executes excellently for the consumer, and there are milion of us. Steve Wozniak at DAC's opening fireside chat pointed out that Steve Jobs can be very ruthless in executing plans, and "I'm glad it's not me; I just want to know how things work." The two Steves made the ideal pair in the early days of Apple and Apple now is the provider of eveything i- to the world. We should all be grateful
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