It would have been surreal if Apple filed for bankruptcy. Given its successful runs in the global smartphone and gadget market of late, losing money is a remote possibility these days for the American tech company.
But apparently, one of Apple's suppliers is losing money. Now, that's a bit of a surprise.
GT Advanced Technologies, Inc., the sapphire crystal supplier of Apple, has filed for Chapter 11 bankruptcy protection, reports ValueWalk.
As of Sept. 29, GT only has $85 million in cash, reports ValueWalk. The company's stock has also declined by more than 90% and is now priced at $1 per share in the NY Stock Exchange.
9to5Mac explained that the filing for Chapter 11 means that the company will still be able to proceed with its normal operations until such time that it can resolve or settle issues with its creditors
ValueWalk said that before the launch of the iPhone 6, there were speculations that the screen of the larger iPhone would be made of sapphire, a precious gemstone. Apple only fueled the rumor further when it eventually entered into a $578-million deal with GT for the supply of sapphire glass.
Apple has been using sapphire supplied by GT in its iPhone lineup for the camera cover and the Touch ID sensor.
Many smartphone experts and users expected sapphire to become part of iPhone 6, but the plan did not materialize due to low yields of the material, reports 9to5Mac.
The same report also hinted that Apple's decision not to use sapphire in the new iPhones was likely one of the factors that caused GT to file for bankruptcy as the company lost the $578-million contract.
"Today's filing does not mean we are going out of business," Tom Gutierrez, CEO of GT, said in a statement.
The filing will enable the company to implement its business plan on a stronger footing and improve its balance sheet, explained Gutierrez in the ValueWalk report.
The company is said to be seeking to acquire debtor-in-possession financing to get more funding for its operations.
As to the repercussion of the GT filing to Apple's operations, the company's smartphone business unit would not be affected at all. But it may have an implication on Apple's decision to use sapphire screen on its upcoming smartwatch.
The ValueWalk report says that Apple's smartwatch is set to debut in 2015.
An initial report about Apple using sapphire screen cover for both Apple Watch and Apple Watch Edition models is yet to be confirmed.
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