Apple has already placed orders for key components used in the next-generation iPhone, which is expected to be thinner and lighter than the iPhone 4 and sport an 8-megapixel camera. As of now the next iPhone is expected to launch in the third quarter, but that timeline could get delayed considering the manufactuer will need to improve its yield rate as the new phone is described as "complicated and difficult to assemble."
"Last month, Hon Hai Chairman Terry Gou said at the company's annual general meeting that the yield rate of Apple's touch-screen devices hasn't been satisfactory, which weighed on the company's profitability.
'The touch-screen devices are so thin. It's really difficult to install so many components into the iPhones and iPads,' Mr. Gou said. 'We hope to raise the yield rate and volume in the second half which will help improve our gross margin.'"
The iPhone has led cellphone industry innovation since the device was introduced in 2007. Apple said in April that it sold 18.6 million iPhones in the fiscal second quarter ended March 26, more than double that of a year ago. That figure was also 15% higher than the December quarter, which is typically Apple's strongest period since it is fueled by holiday sales.