Samsung value drops $10B as investors fear it being cut out of Apple supply chain

Concern that Samsung could lose orders for dynamic random access memory from Apple caused the company’s stock to drop 6 percent on Wednesday.

Rumors from DigiTimes, the Taiwanese technology publication, suggested that Apple has placed huge orders with Elpida, a chipmaker in Japan. That caused concern that Apple was moving its DRAM business away from Samsung, and Samsung’s market value fell by $10 billion, according to Reuters.

Industry watchers have speculated that Apple placed the orders with Elpida in an effort to keep the company running and ensure competition in the market. The Japanese chipmaker has struggled of late, and U.S.-based Micron Technology Corp is currently in talks to acquire the business.

Samsung’s stock troubles on Wednesday also came as a pair of reports from The Wall Street Journal and Reuters said that Apple had tapped a trio of suppliers to supply larger 4-inch screens for its sixth-generation iPhone. Noticeably absent among those three companies was Samsung, which is one of Apple’s chief suppliers of LCD displays.

In fact, Samsung was the sole supplier of Retina displays for Apple’s new iPad when it launched in March. Samsung also builds the custom A5X chip that powers the new iPad, along with other key components.

Reports have suggested for some time that Apple wants to reduce its reliance on Samsung for components, as in addition to being a parts supplier, the company is also one of Apple’s fiercest rivals. In addition to competing in a number of markets, the two companies are also involved in a series of lawsuits accusing one another of patent infringement.

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Film maker. Video game historian. Will put more in here this section soon!
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