Taiyo Yuden Co., a Japanese smartphone ceramic capacitor manufacturer, expects that the demand for its components will continue to increase next year as China promotes the development of 5g cellular technology.
“We have obtained orders for 5g base stations,” shoaka tosaka, CEO of the company, said in an interview on Thursday. “Early next year, we should start to see orders for smartphones related to 5g.”
Tosaka said Huawei and ZTE led orders for base station capacitors. After the trump administration pushed US allies to exclude Chinese suppliers from their networks, the demand mainly came from Chinese operators. Tosaka said Huawei could sell 100 million 5g smartphones in China next year alone.
For Taiyo Yuden, this should have been a bad year because of the surge in smartphone shipments, and the U.S. government blacklisted Huawei as one of its largest customers. But the company sticks to its may forecast and still believes that it will achieve record revenue and profits next year. Facts have proved that the strong demand for capacitors can withstand negative shocks, largely because capacitors are widely used in various electronic devices, from smart phones to electric vehicles. The share price of solar induced electricity has more than doubled this year.
Each 5g mobile phone uses about 1000 capacitors, 30% more than 4G. The new wireless standard is very power consuming and requires a larger battery, leaving less space for other components. Because of this, the demand for high-quality capacitors with smaller volume and more energy storage will increase.
Tosaka said that Huawei is likely to lead the launch of 5g mobile phones, followed by Samsung. Tosaka said that if Apple launches its first 5g iPhone in September as expected, the component order is likely to be issued in June. He said the company has enough capacity to meet demand.
The solar induced plant is currently operating at about 85% of its maximum load, but supply may tighten for the rest of the fiscal year ending March 2020.
Wedbush securities predicted this month that whenever it appears, the first 5g iPhones will “open the gate of device upgrade”. Dan ives, an analyst at the company, wrote in a research report to customers that about 350 million iPhones are in the upgrade window among Apple’s 900 million users.
Multilayer ceramic capacitors (MLCC) made by solar induced electricity are the foundation of the modern world. This miniature component made of metal plate is widely used in electronic circuits to stabilize voltage and current. The capacitor was invented by scientists in Germany and the Netherlands in the 18th century. Now, it has been used in a variety of products from smart phones, televisions to refrigerators and cars. Tosaka said that the demand for MLCC is likely to continue to grow in the next five to ten years.
Although many investors still regard sun induced TV as a member of the smartphone industry chain, the company has successfully reduced its dependence on smartphone components in the past three years. Its orders used to soar around July and August, in preparation for the smartphone model update in the autumn, followed by a trough. At present, automotive and industrial applications account for nearly 40% of solar induced electricity revenue, and tosaka hopes to increase this proportion to 50% within five years.
“In the past, the risk was that some customers accounted for too much business, but now it has become a long tail business,” tosaka said
Responsible editor; zl