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Apple captive Cirrus gagged

Jealously guarding the biggest customer's name
7/31/2012 12:58 PM EDT
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eewiz
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CEO
re: Apple captive Cirrus gagged
eewiz   7/31/2012 2:07:13 PM
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Cirrus Logic would have been a good acquisition target for Apple if not for its current market valuation of 2.4B which is 10 times its 2009 valuation. The current valuation is basically because of its Apple business and the day Apple finds another vendor, Cirrus logic stock will nose dive, which will again make it a good acquisition target for Apple. Convoluted hah? http://www.google.com/finance?q=NASDAQ%3ACRUS

junko.yoshida
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re: Apple captive Cirrus gagged
junko.yoshida   7/31/2012 2:15:28 PM
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Convoluted, but makes sense.

krisi
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re: Apple captive Cirrus gagged
krisi   7/31/2012 2:25:22 PM
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Interesting thought @eewiz...use Cirrus Logic for gen1, find an alternative supplier for gen2, wait for the stock to go down the drain, aquire Cirrus Logic then and get them to design gen3! Kris

junko.yoshida
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re: Apple captive Cirrus gagged
junko.yoshida   7/31/2012 2:37:03 PM
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OK. I got the logistics of how Apple can buy Cirrus at a reasonable price. What I don't understand is the reasons why Apple would every want to buy any perifpheral chip companies (including Authentic acquisition announced yesterday: http://www.eetimes.com/electronics-news/4391386/Apple-to-acquire-fingerprint-chip-firm-Authentec) Would anyone care to walk me through its pros and cons?

eewiz
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CEO
re: Apple captive Cirrus gagged
eewiz   7/31/2012 2:58:11 PM
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Apple would want to acquire chip/other companies for several reasons. 1) it has 100B cash in Bank and investors are pestering them to use it somehow :D 2) Block access to key & uncommon tech to competition (Anolbit,Authentec) 3) Bring inhouse the key and high value components (CPU, maps) so that there dependency on others are reduced. (PAsemi, integrity, C3 ,Placebase) Actually Cirrus logic doesnt fall into key tech/uncommon/high value components. Hence Apple will have less motivation to acquire them.

junko.yoshida
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re: Apple captive Cirrus gagged
junko.yoshida   7/31/2012 3:13:33 PM
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I agree with your assessment -- especially on Cirrus front. But then, here's the thing. That means, while Apple has everything to win, Cirrus will everything to lose, once it gets designed out. Shouldn't Cirrus get compensated for this very lopsided position they are now in?

junko.yoshida
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re: Apple captive Cirrus gagged
junko.yoshida   7/31/2012 3:33:00 PM
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I have another separate question for everyone. i wrote in this story: Cirrus Logics behavior -- jealously guarding the name of its biggest customer -- and the financial community compliance strikes an odd note, especially since Cirrus Logic on Monday filed Form 10-Q with the SEC. In fact, in the 10-Q, Cirrus Logic reported: We had one end customer, Apple Inc. that purchased through multiple contract manufacturers and represented approximately 59 percent and 53 percent of the Company's total sales for the first quarter of fiscal years 2013 and 2012, respectively. So, I am still scratching my head why NOBODY in the conference call would NOT mention the name Apple at all.

krisi
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CEO
re: Apple captive Cirrus gagged
krisi   7/31/2012 3:35:18 PM
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Everyone knew it was Apple?

junko.yoshida
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re: Apple captive Cirrus gagged
junko.yoshida   7/31/2012 3:47:42 PM
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Yes. It was a wink, wink, nudge nudge situation.

old account Frank Eory
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Rookie
re: Apple captive Cirrus gagged
old account Frank Eory   7/31/2012 5:07:05 PM
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Except that Apple used a different audio vendor for Gen 1, maybe also Gen 2, and Cirrus beat them out of that socket for successive generations. Could Cirrus be displaced in the future? Anything is possible, but once you're this deeply entrenched and making custom ICs for your biggest customer, I think you'd have to really screw up badly to lose the business at this point.

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