Chinese Acoustic Components Firm GoerTek Rumored to Lose Apple’s AirPods Order
GoerTek, a key supplier of Apple and a Chinese manufacturer of acoustic components and electrical devices, issued a risk warning announcement on the evening of November 8, saying that it recently received a notice from a major overseas customer to suspend the production of one of its smart acoustic complete products, which is expected to affect its revenue by no more than 3.3 billion yuan ($455 million). Earlier, there were market rumors that the short-term orders of Apple headphones manufactured by GoerTek were adjusted because of the high product defect rate. Therefore, it is rumored that the order that GoerTek lost this time is Apple’s headphone order.
Market rumors started from the Apple supply chain in Taiwan, and it was found out that the GoerTek’s defect rate of AirPods had been falsified for three consecutive years, stepping on the red line of Apple. Rumors emerged that after GoerTek was kicked out of Apple’s supply chain, True Wireless Stereo (TWS) orders were given to Luxshare Precision, and component business was transferred to AAC Technologies Holdings Inc. There are even rumors that Bryan Jiang, the chairman of GoerTek, is offering a humble apology at Apple headquarters in the United States.
However, in the announcement issued this time, GoerTek stressed that the cooperation of other projects with this customer is still in progress. It predicts that this business change is expected to affect the operating income in 2022 by no more than 3.3 billion yuan, accounting for 4.2% of the audited operating income of the company in 2021.
The company pointed out that the impact of this matter on business performance is still under evaluation, and will promote the relevant evaluation work as soon as possible, and fulfill the information disclosure obligations in accordance with relevant laws and regulations. As of the close of November 8, GoerTek fell 3.8% to close at 23.02 yuan per share, with a valuation of $11.27 billion.
Apple entered the Chinese market in 2009, and one year later, GoerTek entered Apple’s supply chain, supplying acoustic components and wired headphones. In 2018, the Chinese manufacturer won 30% of the foundry share of AirPods and became the second largest foundry of AirPods in the world. After that year, the operating income of GoerTek ushered in explosive growth.
SEE ALSO: GoerTek Signs Partnership Agreement with miHoYo and 37 Interactive Entertainment
However, Apple’s orders are not all for GoerTek’s benefit. Because its revenue is extremely dependent on big customers, on March 29 this year, there were market rumors that Apple cut its orders for AirPods headphones. On that day, GoerTek shares hit a down limit in trading.
According to the third quarter financial report released by GoerTek on October 27, the revenue in the third quarter of this year was about 30.549 billion yuan, an annual increase of 35.77%, and the profit attributable to shareholders of listed companies was 1.761 billion yuan, an annual increase of 9.98%.
According to the company’s annual performance forecast for 2022, it is estimated that the profit attributable to shareholders of listed companies will reach 4.06 billion to 4.702 billion yuan, with an annual increase of -5% to 10%. Its profit last year was 4.275 billion yuan.