by Mike Kapsch, Investment U Research
Monday, January 30, 2012
Steve Jobs would be very proud…
Last week, Apple (Nasdaq: AAPL) reported its fiscal first-quarter results for 2012, and the results were nothing short of astounding:
- Quarterly revenue hit an all-time high of $46.3 billion.
- Earnings rose to never-before-seen levels.
- iPhone, iPad and Mac sales also all reached new highs.
Even more, Apple’s CEO Tim Cook says this is only the beginning. He states, “Apple’s momentum is incredibly strong, and we have some amazing new products in the pipeline.”
One of these innovations, the company announced, will almost certainly be the introduction of near-field communication, or NFC, technology in new iPhones and iPads this year.
And for the NFC market, this means a huge boost is just around the corner…
NFC Tech Set for Major Growth
We’ve covered NFC technology extensively at Investment U over the past year. David Fessler was even predicting Apple’s move into this space last July.
But Apple’s announcement comes at a very interesting time… And it strengthens our case that NFC is set for the mainstream.
Consider this… in just three months following Steve Jobs’ passing, Apple sold 37.04 million iPhones and 15.43 million iPads. That means over half a million iPhone and iPad devices are being sold every day.
Pretty soon, all of these phones will have NFC capabilities. That’s a huge market for NFC to tap into.
Plus, Apple is just one of many players hopping on the NFC train. Samsung Electronics, HTC, Nokia and RIM already launched NFC-enabled smartphone models last year. And Microsoft has plans to make its Windows Phone equipped with NFC this year.
DigiTimes reports, as a result, NFC featured in smartphones is set to increase four-fold in just the next two to three years. By 2015, over half of the smartphones in existence will have NFC capability.
But even this could be a conservative estimate.
That’s because NFC technology can do more than just pay for items with your smartphone. It also has the ability to easily share documents and media with the simple tap of two devices.
This is undoubtedly a revolutionary technology in my opinion. And some companies are ready take advantage…
NFC Companies to Consider
When researching NFC technology, one company you’ll hear a lot about is NXP Semiconductors (Nasdaq: NXPI).
After all, NXP is the semiconductor maker that essentially invented NFC technology. But it also isn’t the only company to watch in this space.
Investors will want to track big combo chipmakers such as Broadcom (Nasdaq: BRCM) and Qualcomm (Nasdaq: QCOM). NXP will benefit early as phones use standalone NFC chips. But just like Bluetooth, GPS Navigation, etc… it will be much cheaper to include NFC capability on a combo-chip than to use a separate standalone NFC chip. And NXP doesn’t currently make combo-chips. So eventually they may have to survive on patent royalties alone.
And like NXP, Broadcom and Qualcomm are both semiconductor suppliers for Apple. But unlike NXP, Broadcom and Qualcomm are developing the combo-chips that will include NFC technology for much cheaper production costs.
No matter what happens between within the semiconductor industry, 2012 could be a breakout for NFC technology. And it could very soon completely change the way most people pay for goods and exchange information.
Mike KapschHow Apple is Set to Bring NFC Technology to the Mainstream,