· UBS checks indicate that GT shipped some small quantities of sapphire made in its Arizona fab to one of Apple’s partners in China who is in charge of making sapphire covers.
· Given the early success of starting shipments of small amounts of sapphire to China last month, UBS expects GT could raise its full year 2014 sales guidance to the upper end of its $600M-$800M range, with 80%+ still likely from sales of sapphire materials.
· UBS expects 4th and final prepayment will be made in May
· UBS is estimating 100 furnaces were turned on and running. They expect 400-500 sapphire furnaces to be turned on in 1Q14 and 900-1000 in 2Q14
· Sapphire cover screens margins expected to be around 25%
If you follow the Obscure Analyst, you would already know GT turned on 140 furnaces on January 10th, 2014 and UBS checks indicate that the “Quick Start 140” furnaces made their first delivery of sapphire ingot in to one of Apple’s partners in China who will make the sapphire covers. A sapphire ingot is a sapphire that is “cored” out of the boule that will need to be sliced into sapphire screens. UBS indicated that 2,200 kg of sapphire ingots were shipped to China for processing. I am estimating that approximately 100,000 to 115,000 sapphire screens could be produced from 2,200 kg of sapphire ingots. GT’s selling price per screen based on the information provided is falling into the range of $8.50 to $10 per screen.
I am slightly more optimistic than UBS as far as the sapphire furnace ramp up due to the fact that over 1,200 furnaces have been imported and delivered prior to the Mesa, AZ plant prior to March 3rd, 2014. Additionally, my 1,200 furnace count does not include any furnaces from GT that were taken out of equipment inventory in Q4 ($71m worth), or $180m worth of PP&E that was deployed in Q4 2013 (mostly in AZ). I believe that nearly all of the furnaces were ramped up by the end of March based on GT’s ability to ramp over 500 furnaces a month and given that fact that most of the furnaces were delivered between December and February.
Full Disclosure: I am long GTAT and have no plans to buy or sell any holdings
The Obscure Analyst 
Maybe u should send UBS the shipping receipt of all the furnaces you have found so the professionals are up to date.. U are kIlling it Matt
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Great info and news Matt, I like the specificity!
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Seems like the 2200 kg is a low number for 140 ASF. My understanding each furnace produces a boule every 18 days. Weight of the boule 100 KG so product from 22 ASF or so. Sounds like low rate production to work thru the manufacturing process and tweak before cranking up production.
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The shipment does not equal production. It’s enough to assemble thousands of phones and test everything out. They shipped just a fraction of what has been made. Boule size is 200kg or higher.
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[…] Analyst Matt Margolis estimated today that “approximately 100,000 to 115,000 sapphire screens could be produced from 2,200 kg of sapphire ingots” quoted by UBS, and using their info estimated GT would sell the sapphire screens for between $8.50 and $10. He also estimated that the facility will be at full capacity sooner than UBS noted above in its report, noting that most furnaces were delivered between December and February. […]
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[…] Analyst Matt Margolis estimated today that “approximately 100,000 to 115,000 sapphire screens could be produced from 2,200 kg of sapphire ingots” quoted by UBS, and using their info estimated GT would sell the sapphire screens for between $8.50 and $10. He also estimated that the facility will be at full capacity sooner than UBS noted above in its report, noting that most furnaces were delivered between December and February. […]
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[…] Apple en GT in de fabriek hebben geplaatst. Van 2.200 kilo saffierglas kun je volgens schattingen zo’n 100.000 tot 115.000 saffierpanelen voor het iPhone-scherm kunnen produceren. Zo’n scherm zal tussen de $8,50 en $10 kosten. Er […]
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[…] will install another 400-500 sapphire furnaces in 1Q14 and 900-1,000 in 2Q14. According to analyst Matt Margolis, approximately 100,000 to 115,000 sapphire screens could be produced from 2,200 kg of sapphire […]
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[…] assim como existem pessoas que concordam e pessoas que discordam da decisão. O analista Matt Margolis, por exemplo, estima que “cerca de 100 mil a 115 mil telas podem ser produzidas a partir […]
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[…] Analyst Matt Margolis estimates that “approximately 100,000 to 115,000 sapphire screens could be produced from 2,200 kg of sapphire ingots” quoted by UBS, and using their info, he estimated GT would sell the sapphire screens for between $8.50 and $10. […]
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[…] Analyst Matt Margolis estimated today that “approximately 100,000 to 115,000 sapphire screens could be produced from 2,200 kg of sapphire ingots” quoted by UBS, and using their info estimated GT would sell the sapphire screens for between $ 8.50 and $ 10. The first small shipment sent from GT Advanced to Apple suppliers was worth around $ 1 million. He also estimated that the facility will be at full capacity sooner than UBS noted above in its report, noting that most furnaces were delivered between December and February. […]
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[…] Quelle: margolismatt.com und 9to5mac […]
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[…] sapphire display covers rather than sapphire for home button and camera. According to analyst Matt Margolis, 2,200 kg of sapphire ingots are enough to produce 100K to 115K sapphire […]
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[…] Analyst Matt Margolis estimated today that “approximately 100,000 to 115,000 sapphire screens could be produced from 2,200 kg of sapphire ingots” quoted by UBS, and using their info estimated GT would sell the sapphire screens for between $8.50 and $10. The first small shipment sent from GT Advanced to Apple suppliers was worth around $1 million. He also estimated that the facility will be at full capacity sooner than UBS noted above in its report, noting that most furnaces were delivered between December and February. […]
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[…] Volgens analist Matt Margolis, niet aangesloten bij UBS, is de verscheepte hoeveelheid goed voor ruim honderdduizend schermen. Apple heeft GT Advanced Technologies aangenomen om de schermen te produceren in een fabriek in Arizona. […]
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[…] analyst and industry blogger Matt Margolis said this week that Apple may produce about 100,000 to 115,000 sapphire screens from the 2,200 […]
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Matt – do you think Q1 shipping of ingots could have any significant impact on earnings tomorrow? I think the bar is set pretty low for them, and have to think this was not part of the equation for analysts.
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Absolutely no impact. I do expect Q2 to pick up from Q1 and will get all this out tonight
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[…] Analyst Matt Margolis says that about 100,000 to 115,000 sapphire screens could be produced from tha…It is also estimated that GT will sell these screen for $8.50 to $10. This is said to be about 25% less than sapphire sold by other Apple partners. […]
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