6 months ago Apple bought Authentec, a maker of fingerprint sensors. It's recently been rumored that the iphone 5s, rumored to arrive in June (though it may arrive in September as the iphone 5 did), will have an advanced fingerprint sensor that Authentec was developing that can be used for navigation too. If the iphone does, it's also probable the ipad and macs would too.
During the Craig Hallum conference in September SK said that they had used their LCD driver COF technology to do fingerprint sensors. I asked him about it in October and SK said that they'd been using the technology to do fingerprint sensors for Validity and Authentec for a couple years now, but that the revenue contribution was very small.
Looking back at the annual filings for Authentec, for each year they've either used Chipmos, Chipbond, or both to do bumping. Chipmos and Chipbond are the only choices.
I'm just speculating, but I would think that if the iphone adds a fingerprint sensor then Chipmos, Chipbond, or both would be doing bumping for something like 200M of them per year. I would think that would no longer qualify as "very small."
7 months later and it looks like it's happening. I'd love to know what portion of the business they get, and what revenue they get per wafer (or per unit). iPhones are obviously quite a volume business.
Excellent work Jaret. Once this gets out there, this should bring in some retail investors. Last three months IMOS picked up net total of an additional 4 million shares held by institutional investors which was actually quit impressive. But we saw what happened when they stopped buying, we trickled down on very low volume. Sadly, the retail investor probably will never fully get IMOS, and that is the main reason they need to move it to Taiwan.
Institutional ownership should continue to increase this quarter, but we could also end up with a Himax redux.
A couple months ago I speculated about the possibility of fingerprint sensor business from the iphone 5S. There is a story on appleinsider right now that links to a chinatimes article claiming that the iphone 5S does indeed have a fingerprint sensor acquired from the Apple takeover of AuthenTec, and that Chipbond is doing the bumping, packaging, and testing.
If it is indeed true that the iphone 5S has a fingerprint sensor, and if Chipbond has really gotten all of the work for it (Apple has often chosen multiple suppliers, and over the years Authentec has switched around between ChipMOS and Chipbond) then that's unfortunately not directly good news for IMOS. However, it is still indirectly beneficial because there are only 2 players in the market and only a certain amount of capacity to go around. The more capacity that's consumed in one, the more future business the other gets, and the higher prices go. Something like the iphone 5S could consume a real amount of capacity. An example of this effect is that ChipMOS is now starting to get Renesas and RSP business that Chipbond used to have all of, including iphone 5 LCD drivers. Exciting potential here.