Great moments in Investing

2 Pizzas for 100 million in Bitcoin

I just saw this picture, and thought it was awesome.... but current market cap of Apple puts 10% at 915.74B/10 or 91 Billion...

HC Wainwright -- price target $4.00

Ledger Gazette

Microvision, Inc. (NASDAQ:MVIS) received a $4.00 price objective from research analysts at HC Wainwright in a research report issued on Thursday. The brokerage presently has a “buy” rating on the electronics maker’s stock. HC Wainwright’s price target indicates a potential upside of 154.78% from the stock’s previous close.

MVIS has been the subject of a number of other reports. Zacks Investment Research downgraded Microvision from a “buy” rating to a “hold” rating in a report on Thursday, August 10th. Northland Securities set a $3.00 price objective on Microvision and gave the company a “buy” rating in a report on Friday, August 4th. ValuEngine downgraded Microvision from a “hold” rating to a “sell” rating in a report on Thursday, November 2nd. Finally, S&P Equity Research increased their price target on shares of Microvision from $1.75 to $2.22 in a research report on Thursday, November 2nd. Two research analysts have rated the stock with a sell rating and three have assigned a buy rating to the stock. The stock currently has an average rating of “Hold” and a consensus target price of $3.34.

Focused on Stock Price? You're Doing it Wrong.

If, at this point of this company's history you are terribly focused on the stock price, you're doing it wrong.

Sure, we're all here to make money on this company. We did however choose this company to make money on because it has fantastic disruptive technology. The demand for this technology could be staggering.

First: Owning the unknown. Volume & Stockholders
If you own Microvision now, you're owning an unknown company. If you've been doing due-diligence on it for a long time, you're surprised by the reaction to news. You wonder what it's going to take to move the stock price.

As I'm pretty sure that most of the dedicated holders of MVIS are fully invested, it's going to take word getting out about the company. A news release about a larger order from the Fortune 100 OEM (we know to be SONY) is not going to get word out about the company. It can make you feel a lot better about holding what you do though, because you know that they're going to do something. It worked, now they want more.

So, it's the day after news and the price is down what seems like a lot.  Less than 1/10th of 1% of the shares of the stock changed hands. Is the stock price meaningful? Does it changed what you invested in and why? I don't think so. It's not working that way for me. There are good reasons to own shares in this company, and it's not because of what the shares do on a day by day basis. They are the technology, enthusiasm for it, the market potential for it, and the brilliant business model for it.



Second: The technology and future enthusiasm
Check out the link below.

If you think the potential product looks cool you're not alone. (I'm sure this is part of some crowd funding scheme and I'm dubious even a prototype has been made, and I'm dubious it could work as shown.)

To me the interesting thing is the enthusiasm for it. 3.6 + Million views.

Check the comments, and you get two major themes: First "This is awesome" and Second "this is impossible"

If you're paying attention to Microvision, you know that better than this is not only possible but being manufactured now. -- and it's being manufactured by SONY (a company that makes the best video equipment on earth) and at least one more company.

Cicret Bracelet

BIGGER SCREENS -- Mobile Companies MUST use them -- and PicoP is the ultimate bigger screen  They will have to use Microvision



Third: Market Potential

Consumer electronic products can be delivered in STAGGERING quantities.

iPhone Sales (Forbes) Apple iPhone 6 --- 20 million phones in a month - goal of delivering 70-80 million iPhones between the launch in September and the end of the year!

First run of the Apple Watch? They're talking 10 million units.

Xaiomi plans to sell 100 million smartphones next year. (Tech in Asia)

All the devices that all these companies want to sell -- all want BIGGER SCREENS.



Fourth: License business model

The license business model is a great thing.

Increasing production costs Microvision little in additional capital outlays, 

"The operating expenses are in a place where we expect to be able to ramp the business for a while with them. We're using contract manufacturers so as things ramp up, the investments that we have to make are not that large."

Microvision is virtually guaranteed a profit on each unit sold.


Don't own it for what the price does today... own it for what it will do soon.  Review the Conference call, we're very close. If you are holding, you are holding a still unknown company that is about to burst onto the scene with a significantly disruptive and very popular new device that will deliver information and entertainment to millions.

Top Penny Stocks

http://www.topstocksforum.com/top-5-information-technology-companies-to-own-for-2015-2.html

Top 5 Information Technology Companies To Own For 2015: Microvision Inc.(MVIS)

MicroVision, Inc. engages in the development of miniature laser display and imaging engines based upon its proprietary PicoP display engine technology. Its technology uses two dimensional micro-electrical mechanical systems, lasers, optics, and electronics to create a video or still image from a small form factor device. The company offers Pico projector displays intended to be used for users of mobile consumer devices, such as smartphones, media players, tablet PCs, and other consumer electronics products. Its products also comprise automotive head-up displays that project high-resolution images onto the windshield of an automobile providing the driver with information consisting of GPS mapping images, audio controls, and other automobile instrumentation information related to the car’s operation. In addition, the company offers near-eye wearable display platform to provide personal viewing of information from a mobile device through a wired or wireless connection. Furthe r, it offers ROV hand held bar code scanners, and bar code scanner enabled enterprise solutions through distributors and original equipment manufacturers, as well as directly to end users through its online store. The company serves customers operating in the consumer, defense, industrial, and medical markets. MicroVision, Inc. was founded in 1993 and is headquartered in Redmond, Washington.

Advisors’ Opinion:

• [By Charley Blaine]Shares of MicroVision Inc. (NASDAQ: MVIS) were jumping for a second day in a row Friday on the heels of Sony Inc.’s (NYSE: SNE) introduction of a new handheld projector that uses Microvision’s technology.
• [By James E. Brumley]Did you miss the first big runup from Microvision, Inc. (NASDAQ:MVIS) a couple of weeks ago? If you were regretting it then, it may have all worked out for the best. Though MVIS jumped from a close of $1.35 on the 19th to a peak of $3.38 on the 21st, it was also on the 21st that the weight of that big gain started to bear down. By the 25th, Microvision shares hit a low of $2.01, basically cutting in half the 150% gain that has been made in just a couple of days. 
• [By Bryan Murphy]If the cash you have available is money you absolutely need to invest safely and wisely because you need it (and its appreciation) to love on in retirement, then let me stop you right now – the rest of what you’re about to read probably isn’t for you. On the other hand, if you and your qualified financial adviser agree you’ve got some money you can gamble with [i.e. if you lose it all, it won't matter], then may I direct your attention to Microvision, Inc. (NASDAQ:MVIS)? Long story made short, MVIS has dropped hints of a brewing rebound.

MEMS pricing and Sony Announcement

I'm stepping out on a limb here, but I think in understanding Microvision's current situation this is an important consideration.

(If anyone thinks I got anything wrong in here, please send me a challenge!) 

Last week, Microvision announced a deal with Microvision for $1.9 Million in components from it's Global 100 customer. (Which we know is Sony, but they are still unable to say this.)

The key word is "components."

Microvision has stated in no uncertain terms that they will have three separate revenue streams:

• Components
• Licensing
• Royalties

It is my analysis, that the reason the components are part of this picture is to insure that Microvision can retain rather tight control over its technology. In which case there isn't a business reason to price the components at a high price -- which would mean that the component sale is a very small part of the revenue in this deal with the global fortune 100 company.

EVERYTHING BELOW is based on a SWAG

I expect that the component order is for the MEMS (or "secret sauce") of Microvision's PicoP. This $1.9 Million in components very likely represents significantly more in ultimate revenue to Microvision.

I do NOT know how much MEMS components would be sold for. As a licensing deal, I would assume that Microvision isn't going to be trying to make as much as possible on each MEMS unit,
but more on the licensing portion & hopefully something on the royalty portion.

It is very difficult to know what MEMS prices may be. There are many many vagaries and unknowns. I have perused a number of meme manufacturer sites for pricing the target is huge, and again, there is a lot of unknown.

I have seen prices for MEMs as low as $0.14 each to up to $5.00. The $5 numbers were on smaller quantities of more complex MEMS. After reviewing a number of those sites a $1 price tag for MEMS seems like both a reasonable and somewhat conservative price. The link just below opens a site that I've used as my "middle." (if you have better information, please share.)

Given that a million units was quoted as the break-even point for Microvision. (Stockholder meeting June 2014)  We can expect that the income per PicoP will be at least $12 when all is said and done.

If the mems are $1. I expect that conservatively, the Global Fortune 100 order was for at least 1.9 million PicoP units. Which should mean approximately $23 million in total revenue to Microvision.

Price of Specialty MEMS   -- $1each

Press Release @ Micro vision

PicoP being manufactured NOW

Tokman on UPS -- last two conference calls.

First Quarter Conference Call:

"UPS We announced in march we will be supplying custom picop display modules to outfit distribution facility in us...expect to deliver in third quarter"

Second Quarter Conference Call:

Next topic is UPS, we are currently on track to deliver custom PicoP display modules in the third quarter to UPS which is another Fortune Global 500 customer. The modules are part of a new package guidance  application targeted at increasing processing efficiency in real time package sorting and routing. UPS has informed us that it plans to deploy the system in a facility in the United States.

 Question: As far as the UPS system is concerned, the deployment that you discussed, is that going to be in this calendar year?

Tokman: We’re delivering our modules this quarter and they will deploy it in the US. We cannot specify the timing, because it’s something they are sensitive about, but -you do your own math.

Question: Originally you said this was pilot development, is it still in the pilot stage? Or will this be beyond that at this point?

Tokman: It’s a real implementation in one of their flagship sites. The goal – remember what the goal is, the goal for UPS is to quantify the potential performance improvements of their processes in terms of increase of throughput and reduction of error rate. So they need to quantify this information and they selected the site to implement this.

---

If they are delivering the PicoP engines this quarter... they MUST be making them now.

UPS Numbers -- Gem of the Message Boards

pierrev55 from Yahoo Message Board

The numbers on UPS.

When asked about the backlog, they said that most of it was UPS.
According to the 10Q, $230K is for the collaborative development with F100.

The other part of the backlog is $722K, mostly for UPS.

The infrastructures of UPS are extensive and include 2,400 distribution centers, 93,000 vehicles and 268 airplanes going to 391 airports in the USA and 219 abroad.

UPS has been known to implement their changes across all their centers. The finger scanner has been a huge success.

Assuming only 1000 of their centers were to implement the PicoP solution and each center spent only $100K, that's already $100M.

It's easy to see that if this goes ahead, there will be a nice stream of revenues from that deal.

Do the math!

---

I see a great job looking at the numbers, trimming them to a very reasonable "conservative" number.

$722,000 reduced to a conservative number of $100,000.
2400 centers reduced to 1000 centers.

Result: $100,000,000 to MVIS.

Being Optimistic:

$722,000 reduced to $500,000
2400 centers reduced to 2000 centers

Result: $1,000,000,000  to Microvision.

---

For fun someday, when the UPS driver gets to your home or business, ask the driver this: "How would you like it if your handheld scanner could project a picture of the person who is supposed to receive the package? You scan the package and right there is a picture of the person who should get it?" -- I've asked several, and they're VERY enthusiastic about that idea.

Stickers are expensive. Using small barcode stickers with scanners that project could save UPS a huge amount of money and acres of stickers.

---

To acknowledge a caution posted on another board:  yes, this is an assumption that this money is for implementation, and that other installations will have similar revenue attached to them. 

Thanks for the words of caution. You're right HAB.

Comment at InvestorVillage

Conference call Transcript (partial)

I transcribed this myself. I did not get any part of the transcription from any source other than listening to the conference call. I made efforts to be accurate while still removing extra words that made it difficult to understand.

A couple of questions (and the financial portion of the call) were omitted. (One will be included at a later date.)

If I got something wrong, I'm sorry.

If I got something wrong and you were speaking, please send me a correction and I will update the text as soon as I am able (and include a notation to that effect if you wish.)

After listening, copying and re-listening to this call, I find that while it wasn't an exciting call with new and eagerly anticipated news, it is very positive, shows Microvision to be on track and doing the hard work that it takes to bring a new technology to market. Those of us who appreciate what it takes and have the patience to hold shares in this company until the exciting news happens will be well rewarded.

---

THE CALL

Tokman: In the second quarter, we continued to make tangible progress on our three primary operating goals for the year.

Outside of major announcements with the Fortune Global 500 company which we communicated in June, Q2 was about completing less visible but essential blocking and tackling milestones associated with completing design and development phases and beginning the transition into the production phase.

Let’s start with the first goal, which entails three elements:

·         First completing the display module development phase with the Fortune Global 100 customer.

·         Second, supporting them with their productization and commercialization efforts.

·         And finally, supplying them with key Microvision components.

Now many of you know, our customer announced in January that it aims to bring a high-performance high definition image quality display module to market to use in picoprojectors and other devices with projection functionality.

We have been closely supporting the development of this module which incorporates Microvision’s patented PicoP laser scan beam display technology. We are currently focusing on production planning and support phase with our partner, now that the design and development phases are nearly complete. We also made progress on the negotiations related to the commercial agreements which we are targeting to complete later this year. (probably will be announced.)

Now, moving on to the second operating goal which encompasses building a pipeline of consumer and automotive opportunities for Microvision’s go to market partners. In June we announced a collaboration with a second consumer electronic company, on the Fortune Global 500 list, to develop a display engine for an innovative smartphone product to be offered by this company. The new partner has communicated to us that it targets market introduction of the new product in the second half of 2015.

Shifting to the automotive segment, we previously announced we are working with a global tier one supplier and a major vehicle OEM. Microvision delivered multiple prototype HUD systems to the Tier1 supplier in the second quarter. The prototype head up display system for the vehicle OEM is slated for delivery this quarter. Third quarter. These programs are in the evaluation and test phases as we mentioned earlier which are critical steps to having a new technology adopted and embedded in automotive applications.

Next topic is UPS, we are currently on track to deliver custom PicoP display modules in the third quarter to UPS which is another Fortune Global 500 customer. The modules are part of a new package guidance  application targeted at increasing processing efficiency in real time package sorting and routing. UPS has informed us that it plans to deploy the system in a facility in the United States.

Our business development efforts are focused on forming go to market coalitions that involve all the key stake holders needed to enable a new market. In our case, the coalition involves display engine manufacturers, consumer electronics OEMS, and major retailers. In Q2 we continue to make important progress on several go to market paths involving some of these OEMs and major retailers that are interested in a variety of consumer electronic products utilizing PicoP display technology.

The final goal for the year is to ramp supply chain for high volume production of Microvision components in the second half of 2014. Recall that in 2013 we began development of supply sources for MEMs and other key components with some of the world’s leaders in their respective areas. In the second quarter of this year we began qualification cycles of production processes for Microvision specific components and we expect volume production capacity for our components to be in place in the fourth quarter of this year.

Stephen Holt’s financial presentation. ---

Questions and answers:

Andrew Uerkwitz Oppenheimer:

Q: Thanks, congratulations on the progress you’ve been making. Alex, question for you. As you enter the production phase and several of these potential customers are trying out the products, what are some of the milestones that you need to accomplish and what are some of the potential hurdles you could face to get there?

Tokman: There are several different milestones we need to complete on our own, and then with our partners. If you look at our own deliverables we need to complete qualification phases of Microvision specific components with our specific suppliers and have it ready for mass production in the 4^th quarter. We feel comfortable that we can achieve this.

The other milestones include supporting our fortune global 100 and several other customers in development of their engines because we still are part of the cycle and we’re enlisted to support them with both technical and market support, in preparation for their own commercialization efforts.

Finally, product OEMS who are developing products based on our technology utilizing the engines of our partners also need marketing and technical support to help them to deliver products to market.

So we are working three fronts right now: our own deliverables, and then supporting our partners, both on the engine and the product side, to help them to introduce the best possible products as soon as they are ready.

Andrew: Opex Question….

Q: Mike Latimore, Northland Capital Management: You mention that the design and development is nearly complete with your fortune 100, when do you think that will be complete.

Tokman: We’ve basically completed 95% of the all the deliverables. The 5% that remains we submitted the final deliverables and right now it’s going through acceptance and evaluation phases --so for all practical purposes we expect it to be completed very shortly, and it’s not hindering any other progress on the production support nor on commercial agreement negotiations.

Mike Latimore: Does that have to be complete before the commercial agreement is complete?

Tokman: We expect yes and we expect that this will be done prior to the commercial agreement being completed, yes.

Mike Latimore: On the new smartphone opportunity if they want products for the second half of next year, would that suggest you would see revenue during the first half of next year related to that.

Tokman: You’re right Mike, typically there’s a lead time on a component before they convert it into engines before the product, so if they target the second half of 2015, you would need -back probably three months, this is when we would start receiving something from them from the engine manufacturers who will be receiving orders from the product OEMS, that’s correct.

Mike Latimore: What’s in the 1.1 million of backlog?

Holt: UPS is a large part of that, and some additional development work for the Fortune Global 100. Those are the two main pieces.

Mike Latimore: Do you think you’ll see revenue from the Fortune Global 100 first or the smartphone manufacturer first?

Tokman: Most likely it will be from the Fortune Global 100.

Dennis: I wanted to know the commercial agreement with the first customer, the Fortune Global 100, can you shed any light on how sizeable that deal will be and how close that gets us to the breakeven point, and not needing to raise more funds.

Tokman: I’m going to try to stay within the framework of not disclosing something we’re not allowed to at this time and still give you hopefully enough information. The agreements we’re pursuing right now with the Fortune Global 100 include several. First, there is the supply agreement, second  there is the product support agreement which is independent, third the licensing agreement for the royalties of  incorporating our technology inside their offerings. There are several agreements ongoing, each with different terms and conditions and we have to cross each one to complete this. In terms of what is the size. The size is going to be determined by the size of the demand that this customer will generate for their own products, and for the products from other  customers they will pursue to incorporate their engines. So it’s their target plans, and we’re not at liberty to discuss what their target volumes are.  But we’re excited about this opportunity, this is the largest opportunity has had in the history of Microvision. So we want to see It come to fruition, and we’re doing our part to ensure that it will happen.

Dennis – Cash raising question.. response by Holt

David Morgan: As far as the UPS system is concerned, the deployment that you discussed, is that going to be in this calendar year?

Tokman: We’re delivering our modules this quarter and they will deploy it in the US. We cannot specify the timing, because it’s something they are sensitive about, but -you do your own math.

David: Originally you said this was pilot development, is it still in the pilot stage? Or will this be beyond that at this point?

Tokman: It’s a real implementation in one of their flagship sites. The goal – remember what the goal is, the goal for UPS is to quantify the potential performance improvements of their processes in terms of increase of throughput and reduction of error rate. So they need to quantify this information and they selected the site to implement this.

Unanswerable question – can’t comment..

David: You also discussed a large volume capacity by the end of the year, now is there two components, are some of your partners going to supply all of the pieces on their own, or will you be a supplier in every case of at least part of the module?

Tokman: We will be a supplier in most of the cases. It’s case to case specific. In some cases we will provide more, and others we will provide less. We should be a part of every endeavor, whether it’s engine manufacture, and We expect to be in every module.

David: You say large volumes by the end of the year,  any kind of  an idea what large means? Is that a million units, or more than a million units?

Tokman: It’s a sensitive question because it would guide the demand from some of our partners who ask us not to discuss this publicly. Our goal, as I mentioned -as Steve mentioned, our goal is to have volume capacity ready in the fourth quarter to enable whatever the needs are. We feel that what we have put in place  will satisfy the initial demand, and we have a plan to ramp that as necessary as we see the demand increase subject to lead times that everyone knows they need to provide to us to allow for higher demand.

David: And the commercial agreement that’s in progress, when that’s negotiated and final is that something you’re going to be able to announce?

Tokman: We believe so.

Closing remarks:

Let me start closing remarks by saying that a lot of work has been done by Microvision and our partners and we’re excited at the prospects in front of us. As we’re moving into commercialization stages for our own components, in the second half of this year. We’re concurrently providing both technical and market support to our go to market partners to facilitate their efforts in launching their solutions be it engines or products. PicoP display technology as you know can enable end user experiences that are not attainable by other picoprojection solutions; and that are well-suited for the mobile video consumption that consumers are now making part of their daily routine. We believe the rapidly expanding consumer behavior of watching video on mobile devices creates a perfect opportunity for picoprojection. According to Adobe, for example, online video views on a mobile device has experienced a 57% increase year over year. With smart phones leading the charge, followed by tablets. No matter how great your smartphone or tablet is, the screen is still too small to share information with others. And you have to admit it, watching a 1 and a half hour movie from your smart phone on a 100 inch screen is much more pleasurable than watching it on a 5 inch screen. That’s why having a device or a feature that works in tandem with your primary device and offers an immersive experience could be very valuable, we believe. Hence, if anyone wants to have an immersive experience from their mobile device of choice – experience that is characterized by enormous high-definition image that is always in focus and obtained from a low-power very slim and light device, then Microvision’s PicoP technology is for you. We are very excited about the business partnerships that we have developed and built and are developing and building with the leading industry players who are bullish on this emerging market. Who enlisted our support to bring their solutions to market. At this point we’ll conclude this call.

Institutional Investing and What are the shorts thinking?

Active institutional position are getting much larger.

But there are still a lot of short positions in the stock.

Active Positions

	HOLDERS	SHARES
Increased Positions	20	1,462,762
Decreased Positions	6	117,202
Held Positions	18	2,889,542
Total Institutional Shares	44	4,469,506

Read more: http://www.nasdaq.com/symbol/mvis/institutional-holdings#ixzz38gglPVdm

New and Sold Out Positions

	HOLDERS	SHARES
New Positions	9	369,466
Sold Out Positions	1	50,500

Read more: http://www.nasdaq.com/symbol/mvis/institutional-holdings#ixzz38ggoPhub


What are the shorts thinking?

There are only a few options for them right now that make any sense to me. I'd like to know what other people think is possible. 

1) They might think the MVIS tech will be a fail and will be shown to be a complete failure soon. (Even a short-term pop in the stock could force them to cover.) 

We know this isn't the case. We've seen the product in action, and for durability, we know that it has successfully performed while bouncing around in Japanese cars - in extreme heat and cold and humidity. It works, It won’t fail. 

2) They think that a product release will be disappointing. That instead of a huge release of a product, it will dribble out of Sony as an add-on to a video camera and little else. 

I must admit this is a concern, but not a significant one. It is possible that management at Sony will dribble the technology out instead of doing a massive release. I doubt it though. Even a fearful management team would not want to dilute their thunder. 

3) They don’t believe in the technology at all. Maybe they’ve seen the Texas Instruments DLP projector for which they claim 80 lumens, and thought that a Microvision PicoP projector rated at 35 lumens has to lose in comparison. 

I actually think this is high likelihood in the short camp. Gigantic Mistake. I have seen the DLP projector on the current Sony video projector — there are several, the one I saw in action is horrible. The throw ratio is poor, the picture is dim, and the focus is touchy. The ShowWx absolutely blows it away it is superior in every respect. And the current demo model shown at the ASM is very superior to the ShowWx. 

If they believe the comparisons — I could understand shorting the stock.



I would be absolutely astonished if ANYONE who has actually seen the technology in action could possibly be short the stock. 

4) They are trying to manipulate the stock lower, to make it cheaper. I’d say this is possible, but probably by trying to sucker other people into shorting the stock.

Potential Demand --- food for thought

Last year, in a single weekend, Apple sold ten million units of the upgraded iPhone 5.

This year, they're asking for 70-80 million units of the iPhone 6.

The demand for gadgets with mobile video is HUGE. 

Microvision will be able to sell lots of PicoP.

***************************************************************************

From MarketWatch

July 21, 2014, 8:51 p.m. EDT

Apple to suppliers: Gear up for the next iPhone

By Lorraine Luk

Apple Inc. is preparing for its largest initial production run of iPhones, betting that larger-screen models will lure consumers now attracted to similar phones from Samsung Electronics Co. and others.

The Cupertino, Calif., company is asking suppliers to manufacture between 70 million and 80 million units combined of two large-screen iPhones with 4.7-inch and 5.5-inch displays by Dec. 30, according to people familiar with the matter.

Its forecast for what is commonly called the iPhone 6 is significantly larger than the initial order last year of between 50 million and 60 million versions of the iPhone 5S and 5C--which had a display measuring 4-inches diagonally, these people said. Both of the coming models are expected to feature metal cases similar to the iPhone 5S and likely come in multiple colors, these people said.

Apple stuck with smaller displays on iPhones even as rival smartphone makers rolled out bigger screens and customers clamored for larger phones. Demand for larger-screen smartphones boosted Samsung, which started offering a 4.8-inch display in its Samsung Galaxy S models in 2012 and introduced an array of bigger phones.

Apple is scheduled to report its fiscal third-quarter results on Tuesday and provide a financial outlook for the current period ending Sept. 28. Historically, Apple has released a new iPhone in mid-September.

Analysts are forecasting Apple will report sales of about 35.9 million iPhone units for the three months ended June 30. That would be up about 15% from a year earlier.

For Apple, one possible hiccup with the larger screen is that display makers for the new iPhones are struggling to improve the production of the larger 5.5-inch screens, people familiar with the matter said. The production is complicated because the displays are using in-cell technology, which allows the screens to be thinner and lighter by integrating touch sensors into the liquid crystal display and making it unnecessary to have a separate touch-screen layer.

To factor in the possibility of a higher failure rate for displays, Apple has asked component makers to prepare for up to 120 million iPhones by year-end, the people familiar with the matter said. It made a similar request last year to prepare enough parts for a combined 90 million iPhones to provide some slack in its supply chain.

The 5.5-inch iPhone screen would face an additional manufacturing complication if it uses a cover using sapphire crystal, a more durable but costly alternative to glass, people familiar with the matter said.

Apple's iPhone production forecast assumes a surge in demand from Apple's partnership with China Mobile Ltd., the world's largest carrier, which started offering the iPhone earlier this year. Bigger-screen smartphones are also popular in China and other emerging markets where the smartphone is replacing the personal computer as a main computing device.

As Apple competes against Google Inc.'s Android operating system, larger screens are now common in Apple's core mobile market--high-price phones. In May, 98% of Android smartphones that sold globally at the equivalent of $400 or above featured a display greater than 5 inches, according to Counterpoint Research.

The new iPhones are coming to market as Samsung's smartphone business is showing signs of sluggishness. Earlier this month, Samsung warned that its earnings would fall for a third straight quarter due to a glut of unsold smartphones. It is feeling the pinch in emerging markets where its low- to mid-end smartphones are facing intense price competition from rival Asian handset makers including Lenovo Group Ltd. and Xiaomi Inc.

Every year, Apple faces a delicate balancing act. It is critical for Apple to ensure that it has enough supplies of a new iPhone during the holiday season when demand is greatest. Shortages can often result in sales for its rivals, although too much inventory also is a concern.

Apple disappointed investors in last year's December quarter when iPhone sales rose 7% from a year earlier, falling short of Wall Street expectations of a 15% increase as it struggled to fulfill demand for the 5S and failed to move enough 5C units. The slump proved temporary, with Apple reporting a 17% increase in the following quarter.

Michael Walkley, an analyst at Canaccord Genuity, said there is "strong pent-up demand" for the iPhone 6 because customers have held off on upgrading from older iPhone models.

To fulfill Apple's demands, the company's two main iPhone assemblers--- Pegatron Corp. and Hon Hai Precision Industry Co., also known as Foxconn--are on a hiring binge at their respective manufacturing sites in China. Foxconn, for example, is hiring workers by the hundreds a day to staff production lines at their respective manufacturing sites in China, said people familiar with those companies.

Foxconn and Pegatron plan to start mass producing the 4.7-inch iPhone model next month and Hon Hai will begin making the 5.5-inch version exclusively in September, the people said.

Often, Apple's production forecasts are adjusted based on early demand, according to people familiar with the matter. For example, Apple tweaked its initial forecasts for the iPhone 5S and iPhone 5C last year when the more expensive 5S initially sold better than expected and the 5C slumped in the first few months, these people said.

Apple Chief Executive Tim Cook has also warned that the supply chain is "very complex" and that it is impossible to take a data point from a supplier and extrapolate a broader meaning for Apple's business.

Suppliers also say that Apple likes to build up inventory heading into the new year, because it is difficult to keep production lines humming at full capacity since many workers go home during Lunar New Year, which is in February next year.

Write to Lorraine Luk at lorraine.luk@wsj.com, Daisuke Wakabayashi at Daisuke.Wakabayashi@wsj.com and Eva Dou at eva.dou@wsj.com 

How to invest in the next Apple

Full Article.  

-- I scraped this, because I am unsure if it will stay in the sample place.

By Elizabeth MacBride

If an unkempt man pitching what looked like a souped-up typewriter walked into your office, would you have the wisdom to invest in his company?

Mike Markkula did. He was an early investor in Apple and eventually one of its CEOs. Just as inspiration: If you'd taken a one-third stake in Apple back then and held on to it, that stake would be worth $190 billion today, based on the company's current market capitalization.

Of course, there's only ever going to be one Apple(AAPL)-but in the past few years, a growing number of technology platforms and new companies have begun offering smaller investors a chance to be part of this generation's most innovative and disruptive companies. These are upstarts that are building billion-dollar enterprises at warp speed. A poster child is virtual reality company Oculus Rift, which was bought for $2 billion by Facebook (FB) in March, just two years after it was founded.

Read More Apple evangelist reveals the art of innovation

New federal regulations are also likely to open the door wider to smaller investors to become start-up, angel or microventure investors. In short, the opportunities that used to be reserved for the wealthy and well connected are coming your way.

"Historically, participating in private investment has been limited. Minimum investments are typically $1 million, and it takes months to network in the field. We are expanding participation," said Ryan Caldbeck, CEO of San Francisco-based CircleUp .

CircleUp is one example of the new entrants in the private equity space. It's a two-year-old tech company that gives accredited investors, those with $200,000 in income or $1 million in assets, excluding their homes, the chance to invest in consumer-brand companies start-ups online.

Just because there are more chances for you to invest, of course, doesn't mean you'll make a ton of money-or even any money-doing it. Very few professional angel investors or venture capitalists make money. Data on angel investing is scant, but a study by the Kauffman Foundation found that only about one-fifth of venture capital funds beat a public-market equivalent by enough to make their fees worthwhile.

Read More Is entrepreneurship contagious?

Why is it so hard to pick winners? You have to be able to recognize an innovative idea, evaluate its chances of success, and then have a hefty dose of luck that something like an act of God or major scandal doesn't mess up the company's fortunes.

And how do you know a good bet when you see it? According to Clay Christensen, Harvard Business School professor and one of the world's top thinkers on disruptive innovation: "In order for a start-up company to succeed, almost always they need to either create a huge new market where there wasn't one before, or find a new way to be more profitable serving the least attractive customers of existing markets. If a start-up's ambition is to beat well-established incumbents by building a better mousetrap, their odds of success are extremely low," he said.

Here are five ideas for ways you could get involved in disruptive companies-either for money or pleasure.

Use a crowdfunding approach. Many great companies got their starts on crowdfunding platforms. San Francisco-based water filter maker Soma, for instance, raised its money on Kickstarter (CNBC's No. 49 Disruptor ). At the moment, crowdfunding sites don't allow equity investing , but that may change if the SEC loosens its regulations on accredited investors, as it is expected to later this year.

Indiegogo, another crowdfunding site, has already said it is exploring options to offer equity investing to small-scale investors depending on what the SEC says. Even before that, though, you can be involved in high-profile innovators like Oculus Rift, the Irvine, California-based virtual reality company that raised $2.4 million of seed funding on Kickstarter.

Read More Indiegogo's plans for global crowdfunding domination

A high-volume crowdfunding site gives you the chance to take a portfolio approach to start-up investing, which most experts suggest. That means that you set aside $10,000, $50,000 or whatever you can afford and invest it in a number of different companies.

If you have enough money, become an angel. CircleUp, for instance, allows anyone who is an accredited investor to easily become an angel in consumer brand companies. Typical investments are in the five figures, Caldbeck said, but companies decide what kinds of minimums they want to set for their investments-they can be as high as $50,000 or $100,000. No investors have made money on CircleUp, which is only two years old, but the brand companies on the platform are growing their revenue at an average of 80 percent a year, and several have received investments from venture capital firms.

AngelList ( CNBC's No. 26 Disruptor ) is another online platform bringing transparency to this previously opaque world; it lists companies raising money, as well as prominent investors who might be accepting limited partners in their venture capital funds. If you prefer to work offline and join one of the proliferating angel investment groups, the Angel Resource Institute is a good place to start.

Look for opportunities globally. In the United States, there is money in search of opportunity. Internationally, there is opportunity in search of money, so your chances of being able to invest in a top innovator are higher. "Look for the great filters in the region, women and men, and get to know the ecosystem if you have a taste for the risk and the stamina for it," said Christopher Schroeder, a venture investor and the author of "Startup Rising," a book about start-ups in the Middle East.

Dave McClure, who runs the famous Silicon Valley start-up incubator 500 Startups and is also a start-up investor, said that 25 percent of the companies he invests in are now international. He expects that to grow to 50 percent within the next five years.

McClure gave an example of a company he invested in called Viki, which provided video subtitles in foreign languages and which was acquired after four years by Japanese e-commerce giant Rakuten(Tokyo Stock Exchange: 4755.T-JP) for $200 million.

If you're interested in international investing, you can take two approaches: Network among the angel groups to find venture capital funds working internationally. Or, if you have connection or interest in a particular market, you can do your own on-the-ground reconnaissance and networking.

"They're really quite accessible and not nearly as foreign as you tend to think," said McClure. "They're less than a 24-hour flight. There are modern-day Marco Polos happening in greater and greater numbers."

It's likely that crowdfunders and new technology platforms will broaden their scope to allow international equity investing at some point, too.

Read More The most innovative start-ups in business

Work through the public markets. Not every innovator is a small, privately held start-up. If you have some money that you want to have fun with and you want to invest in entrepreneurial energy, you can take the old-fashioned approach to all this, buy the stock of a company you admire, and hold on to it. In June of 1984, 30 years ago, Apple was trading at about $25 a share. The stock peaked at $700 last year and has since split . Buying shares of Apple when it was a small publicly held company wouldn't have made you a billionaire, but it would have created quite a nest egg.

Remember to be skeptical. Companies that innovate and succeed like Apple come along only a few times in a generation. You should invest only as much as you can afford to lose. Recognize that start-up investing is a particularly high-risk, high-reward game, so it's important to limit your exposure.

But there are many disruptive start-ups making history in small and large ways. As the story of Oculus Rift shows, technology is accelerating the pace of success. And there are lots of new chances for you to be part of those success stories.

-By Elizabeth McBride, special to CNBC.com