Apple to Have Returned 5-8 million iPhone 5S due to Fingerprint Sensor Issues

During the past year, Apple’s shares (NASDAQ:AAPL) oscillated between $385.1 / share and $705.07 / share. However, the peak was during fall last year, when the iPhone 5 was announced which means that the share price declined during the past year, the lowest point being reached this April, on Friday the 19th. There are many reasons that contributed to the share price decline (among them being the fact that Apple’s profit declined for the first time in ten years). A more recent contributing factor to the share price decline might be related to the rumors that the iPhone 5S will be delayed.

As we told you a few days ago, Apple returned five to eight million faulty iPhones back to Foxconn (the smart phone’s manufacturer). At the time we did not know what the problem was; this is what we reported:

It would seem that between five and eight million units have been been returned by Apple to Foxconn due to faults that rendered the smart phones unfit to be sold. It is not clear what exactly was wrong with the returned units as the source for the news is a Foxconn employee (under anonymity, of course) who reported to China Business. The translation of the report was run through a few different translation engines and it shows that Apple returned more than five million smart phones (as much as eight million units) <> [...] Another possible consequence might be a delay and in a strange coincidence the iPhone 5S is expected to be delayed.

While the source did not mention a reason for the faulty iPhone, nor did it mention what iPhone model was involved, we now know that the faulty iPhones were in fact iPhone 5S models. We also know what the problem was with the batch of iPhone 5S models that Apple sent back to Foxconn. The faulty component was Apple’s fingerprint sensor and because of this faulty fingerprint sensor, Foxconn will have to pay over $250 million for replacements, an amount that equals two thirds of the Taiwanese company’s annual profits.

This news confirms the iPhone 5S’ delay; if you were hoping to get your hands on the iPhone 5S this May (or maybe early June), you will be disappointed as it seems that we won’t have the chance to get it that early. Instead, the replacements will probably be available in July and not earlier. And even July may pass without the iPhone 5S being in our hands as it largely depends on Foxconn and if they manage to have the replacements ready in time.

If the batch of iPhone 5S units sent back to Foxconn won’t be repaired, they might appear in scrap sales in China so those of you interested in an iPhone 5S (with a faulty fingerprint sensor) might want to watch China scrap sales.