More Evidence of Growth in Camera Market

Thursday, August 3rd 2017

This week both Apple and Sony released information to the market relating to their performance in the last three months. 

Apple revealed that they had sold 41 million iPhones in the last quarter.  Through a code release Apple also inadvertently revealed that the next iPhone will include facial recognition using an additional front facing infrared camera.

Sony’s consolidated financial results reported its highest-ever first-quarter operating profit.  The profit surge has been driven by sales of Sony’s market leading image sensors, used in smartphone cameras.  Sony are set to open additional production facilities that will increase image sensor manufacturing capacity by around 20%, reflecting confidence that the smartphone camera market will continue to grow.

CML thinks these announcements provide further evidence that the high demand for cameras in smartphones remains unabated.  The leak that the next iPhone will include a second front camera – taking the number of cameras up to four per smartphone - is in line with most analyst’s view that the volumes for camera modules is set to continue to increase.

It is also noteworthy that camera module ASPs are increasing.  In contrast to the view that margins in the smartphone market have been squeezed, particularly in China, the margins attached to smartphone cameras and the high quality optical components that differentiate one smartphone from another remain healthy.