Apple ( AAPL) finally took the wraps off its iPhone Tuesday. But investors didn't wait for details about which components were inside
the long-awaited phone to bulk up on chip stocks that might benefit. Within a half-hour of Jobs' first words about the iPhone during his speech at the MacWorld conference in San Francisco, shares of various chipmakers took flight. Marvell Technology Group ( MRVL), RF Micro Devices ( RFMD), Atheros Communications ( ATHR) and Maxim Integrated ( MXIM), all of which make chips used in cell phones and electronic gadgets, saw their stocks rise in unison immediately after the iPhone announcement. The various features within the iPhone, from Wi-Fi capabilities to a digital camera, mean there are plenty of specialized chips crammed inside the thin device. Though it's still unclear which companies are providing the silicon inside the iPhone, investors appeared eager to place bets on the most likely candidates. Broadcom ( BRCM) was up about 4.6%, or $1.51, at $34.36 in midday trading. UBS analyst Alex Gauna speculated in a note that Broadcom may have provided the integrated circuit controller enabling the phone's multitouch capability. UBS makes a market in shares of Apple and Broadcom and has provided non-investment-banking services to Apple in the past 12 months.
Skyworks ( SWKS), which was cited last month by Stifel Nicolaus analyst Cody Acree as a likely candidate to provide the front-end module and switch in the iPhone, was up 3.3% at $7.14. Stifel makes a market in Skyworks and has provided the company with non-investment-banking services in the past 12 months. Apple will sell the phone through Cingular Wireless, with prices ranging between $499 and $599, depending on the amount of flash memory in the model. UBS' Gauna reckoned that Apple could sell 12 million units within the first year. Dan Niles, the CEO of Neuberger Berman Technology Management, which owns Apple and Broadcom, says the iPhone looks very interesting. But he said that when it comes to chip companies, he's more interested in the overall business than in any short-term iPhone tailwind. "Given the success that Apple has had with form factors this could be a big revenue driver for some of these semiconductor companies in the future," says Niles. "But for right now, a lot of these names like a Broadcom -- they're so big -- that in the near term a lot of the drivers are going to be the fundamentals of their own business," says Niles.