Top 4 Asia Smartphone Supply Chain Stocks to Watch According to Jefferies

Investing.com -- As the global smartphone market shows signs of modest growth with projected shipments of 1,255 million units in 2026 (up 1.5% year-over-year), Jefferies has identified key players in the Asian smartphone supply chain positioned to benefit from industry developments.

According to Jefferies, the smartphone industry faces three major trends in 2026: increasing AI functionality adoption, continued growth in foldable smartphones, and Apple maintaining stable growth.

However, challenges remain as Apple navigates tariff pressures and strategic shifts toward AI integration, with iPhone 17 build forecasts of 78.5 million units in the second half of 2025 slightly below market expectations.

Here are the top performers in the Asia smartphone supply chain according to Jefferies:

1. MediaTek - The Taiwanese semiconductor company is on the Jefferies’ list as it stands to benefit significantly from the increasing AI functionality in smartphones. As mobile processors become more sophisticated to handle on-device AI applications, MediaTek’s position as a leading chipmaker for smartphones places it at the forefront of this technological shift.

2. Hon Hai - Better known as Foxconn, this major Apple supplier ranks second on Jefferies’ list. Despite Apple’s diversification efforts to India and Vietnam, China remains a critical supply chain base, and Hon Hai continues to be instrumental in iPhone production. The company’s manufacturing expertise positions it well for Apple’s upcoming releases, including the innovative iPhone 17 Air.

3. Largan - This precision lens manufacturer secures the third position as smartphone camera capabilities remain a key differentiating factor for consumers. With Jefferies noting that camera performance will be a priority consideration for iPhone 17 buyers deciding between the Pro Max and Air models, Largan’s high-quality lens components maintain their importance in the supply chain.

4. Flexium - This flexible printed circuit board (FPCB) manufacturer is well-positioned to capitalize on the trend toward foldable smartphones. As Jefferies highlights the continued growth of foldable devices and notes that the iPhone 17 Air may be preparation for Apple’s future foldable iPhone, Flexium’s expertise in flexible components becomes increasingly valuable.

The global smartphone market continues to evolve with moderate growth expectations amid ongoing US-China trade tensions and shifting consumer preferences toward AI-enabled devices and larger screens.

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