Kuo: Apple's future MR Headset will include 2-custom CPUs that will give Apple a 2–3 year lead over competing Headsets in Raw Power
The latest survey from TFI's Apple analyst Ming-Chi Kuo (listed as Guo Mingchi officially) indicates that each Apple AR/MR headset will adopt two CPUs made of 4nm and 5nm, and both CPUs will use ABF (Ajinomoto build-up film) substrates. The processors and ABF are currently being developed exclusively by TSMC and Unimicron.
We forecast the Apple AR/MR headset will create demand for 6 million, 16–20 million, and 30–40 million ABF substrates in 2023, 2024, and 2025, respectively. Unimicron, the world’s largest ABF supplier, will be the biggest winner.
Strong demand from Apple (AR/MR headsets) and AMD (server CPUs) will enable Unimicron to see ABF order visibility from the market consensus of 2022–2023 to beyond 2025–2026.
The Apple AR/MR headset is equipped with two ABF substrates, which is higher than our previous estimation and market consensus of one.
Currently, Unimicron is the exclusive supplier of ABF for the Apple Mac series. We predict that Unimicron will exclusively supply the ABF for Apple AR/MR devices. Even if there is a new ABF supplier for the second generation, Unimicron will be the main supplier from the capacity and technology point of view.
Our survey indicates that Apple AR/MR headset will use a 96W charger supplied by Jabil with the same specifications as the MacBook Pro to provide faster and more efficient charging for the Apple AR/MR headset. This charger specification proves that Apple AR/MR requires the same level of computing power as the MacBook Pro and is significantly higher than the iPhone.
We believe the growth of Apple AR/MR headsets will be driven by (1) vivid AR innovative user experiences, (2) innovative user experiences that seamlessly switch between AR and VR, (3) ecosystem advantages, and 4) a more affordable second generation.
The market consensus is that the ABF supply-demand gap will improve from 2H23. However, we expect that strong demand from Apple and AMD will extend the visibility of the ABF supply-demand gap from Unimicron beyond 2025–2026.
Apple's metaverse headset is about 2–3 years ahead of competitors' products in computing power.
At present, the largest chip supplier of AR/VR headsets is Qualcomm, and its mainstream solution XR2 has a computing power of mobile phone level. We think Qualcomm will take at least 2023–2024 to launch PC/Mac computing grade AR/VR chips, and Apple's competitors' AR/VR/MR products will also have PC/Mac-level computing power and use ABF substrates starting from 2024–2025. At that time, Unimicron will benefit from both Apple and non-Apple's metaverse headset ABF orders.