Apple reportedly nixes iPhone 15 button upgrade, sending supplier stock down 12%

Apple supplier Cirrus Logic’s shares fell about 11% midday Wednesday after a report from analyst Ming-Chi Kuo said that the upcoming iPhone 15 Pro won’t use Cirrus’ haptic touch technology as heavily as initially expected.

Cirrus’ technology and parts help power Apple’s haptic touch systems, which have been used to replace physical buttons, like the Home button on some iPhones, with touch-sensitive buttons that mimic the way a button push feels. Cirrus’ relationship with its “largest customer,” widely acknowledged as Apple, provided around 88% of Cirrus’ revenue for the most recent quarter.

Kuo had previously said that Apple would expand its use of Cirrus’ technology beyond haptic touch and replace the physical volume buttons with solid-state technology. But, in his most recent note posted on Tuesday evening, Kuo said that “unresolved technical issues” had forced Apple to abandon the change.

“Investors had anticipated that the new solid-state button design would increase suppliers’ revenues and profits; thus, this change is particularly unfavorable for Cirrus Logic (exclusive Controller IC supplier) and AAC Technologies (Taptic Engine supplier),” Kuo wrote on Tuesday.

Shares of Shenzhen, China-based AAC fell just under 15%.

Cirrus and Apple didn’t immediately respond to requests for comment.