GT Advanced Saw Production Troubles as Early as February

GT Advanced Technologies, Apple's sapphire partner, may have been seeing production problems and missing technical milestones as early as February, according to a new report from The Wall Street Journal that examines GT's securities filings.

It's widely known that Apple did not provide GT Advanced with a fourth and final $139 million loan payment aimed at giving the sapphire supplier a means to purchase vital equipment, but Apple also delivered its third payment to the company two months after it was expected.

gt_advanced_logo
GT was set to receive a $103 million payment in February of 2014, but did not receive the payment until April 2014, two months later, as it had failed to meet Apple's requirements on time.

The third payment, of $103 million, was due in February, but Apple did not make it until April, according to GT's securities filings. The final installment of $139 million was due in April, according to a GT securities filing. In August, GT said it expected the payment by October. But Apple never made the payment, because GT did not meet certain requirements, according to people familiar with the matter.

Shortly after GT Advanced missed its February payment, the company's CEO, Thomas Gutierrez and its Chief Operating Officer, Daniel Squiller, set plans in motion to begin selling off stock. While the timing of their subsequent sales was subject to the schedules laid out in their trading plans, it is clear those plans were established after GT began having difficulties meeting its milestones.

Gutierrez set up a pre-arranged Rule 10b5-1 sale in March, which saw him selling more than 9,000 shares of GT Advanced stock on September 8, a day ahead of Apple's iPhone announcement. Gutierrez also sold off stock throughout the year, netting more than $10 million before stock prices faltered after it became clear Apple was not using sapphire in the iPhone 6 and 6 Plus.

Squiller sold $1.2 million worth of stock in May and made plans to sell off additional shares throughout 2014, garnering another $750,000 before the company filed for bankruptcy. Squiller continues to hold more than 200,000 shares of GT stock, which have lost much of their value.

Apple did end up making a total of three loan payments to GT Advanced totaling $440 million after signing an agreement in October of 2013, and the company also reportedly tried to help the supplier meet the requirements to receive the fourth payment ahead of GT's surprise Chapter 11 bankruptcy filing.

GT Advanced's deal with Apple was highly favorable to the Cupertino-based company, with the sapphire supplier taking on all of the risk. Apple supplied the facility and the loan for the company to purchase equipment, but GT was required to meet technical milestones to receive the money and it also signed contracts that prevented it from selling its sapphire to other companies. Apple, meanwhile, was under no obligation to purchase GT's sapphire.

Details about the deal's deterioration have been coming out bit by bit, making it difficult to piece together exactly what went wrong. It appears that GT's failed to produce sapphire up to Apple's standards, leading the company to stick with Gorilla Glass instead of sapphire screens for its iPhones. GT Advanced has been able to supply little information on its bankruptcy filing, as it is bound by non-disclosure agreements that could see it paying $50 million in fines for each violation.

Apple and GT Advanced have asked to keep court documents sealed, but The Wall Street Journal today filed a motion asking the court make the documents public.

Following its Chapter 11 bankruptcy filing, GT Advanced last week asked for permission to begin winding down operations at its Mesa, Arizona sapphire plant, suggesting the company plans to cease its sapphire production all together. Apple has said that it plans to focus on "preserving jobs" in Arizona, and is working with local and state officials as it considers its next steps.

Popular Stories

apple wallet drivers license feature iPhone 15 pro

iPhone Driver's Licenses: These 17 U.S. States Offer Them or Will Later

Thursday June 19, 2025 11:28 am PDT by
In select U.S. states, residents can add their driver's license or state ID to the Wallet app on the iPhone and Apple Watch, providing a convenient and contactless way to display proof of identity or age at select airports and businesses, and in select apps. Unfortunately, this feature continues to roll out very slowly since it was announced in 2021, with only nine U.S. states and Puerto...
apple watch ultra 2 new black

Apple Watch Ultra 3 Finally Coming After Two-Year Hiatus

Monday June 16, 2025 8:45 am PDT by
Apple will finally deliver the Apple Watch Ultra 3 sometime this year, according to analyst Jeff Pu of GF Securities Hong Kong (via @jukanlosreve). The analyst expects both the Apple Watch Series 11 and Apple Watch Ultra 3 to arrive this year (likely alongside the new iPhone 17 lineup, if previous launches are anything to go by), according to his latest product roadmap shared with...
iPhone 17 Pro Blue Feature Tighter Crop

iPhone 17 Pro Launching in Three Months With These 12 New Features

Saturday June 14, 2025 5:45 pm PDT by
The iPhone 17 Pro and iPhone 17 Pro Max are three months away, and there are plenty of rumors about the devices. Below, we recap key changes rumored for the iPhone 17 Pro models as of June 2025:Aluminum frame: iPhone 17 Pro models are rumored to have an aluminum frame, whereas the iPhone 15 Pro and iPhone 16 Pro models have a titanium frame, and the iPhone X through iPhone 14 Pro have a...
ios 26 call holding

iOS 26 Beta is Hiding a New Ringtone — Here's What It Sounds Like

Thursday June 19, 2025 7:25 pm PDT by
Apple is hiding a new ringtone within iOS 26. The new ringtone is an alternative version of the existing Reflection ringtone, which has been the default ringtone since the iPhone X was released in 2017. It was discovered within the code for the first developer beta of iOS 26, but it remains hidden, so you will not find it in the list of ringtones available in the Settings app for now. It...
iOS 18

Apple Releases iOS 18.6 Public Beta

Wednesday June 18, 2025 10:24 am PDT by
Apple today seeded the first betas of upcoming iOS 18.6 and iPadOS 18.6 updates to public beta testers, with the betas coming just a few days after Apple provided the betas to developers. Testers who have signed up for beta updates through Apple's beta site can download iOS 18.6 and iPadOS 18.6 from the Settings app on a compatible device by going to General > Software Update. When the...
General Spotify Feature

Spotify Preparing to Launch Long-Awaited Lossless Audio Tier on iPhone

Thursday June 19, 2025 1:46 pm PDT by
Spotify appears to be gearing up to launch its long-awaited lossless music tier. Chris Messina (via TechCrunch) and Spicetify (via The Verge) spotted new lossless references within the code for Spotify's desktop app and web player. With assistance from Aaron Perris, MacRumors has confirmed that the latest beta of the Spotify app for the iPhone also contains new lossless-related code....
new iphone lockscreen ios 26

iOS 26: Five Changes Coming to Your iPhone Lock Screen

Tuesday June 17, 2025 8:46 am PDT by
With iOS 26, Apple has made some additions to the iPhone Lock Screen that aim to make it more customizable than ever. Of course, things can always change before the software makes its way to the general iPhone-owning public, but here are five new things iOS 26 can do on the Lock Screen as of the current developer beta. Widgets Top or Bottom In iOS 18, the row of widgets on your Lock...
iOS 26 on Three iPhones

Apple Says iOS 26 Won't Be Available on These iPhone Models

Tuesday June 10, 2025 6:58 am PDT by
Apple this week revealed that iOS 26 is compatible with the iPhone 11 series and newer. That means that iOS 18 is the end of the road for the iPhone XS, iPhone XS Max, and iPhone XR, which were all released in 2018. However, those devices will continue to receive security updates for at least a few more years. iOS 26 is compatible with the following iPhone models: iPhone 16e iPhone...
Craig Federighi No

John Gruber Reacts to Apple Declining His Interview After His Criticism

Wednesday June 18, 2025 8:10 pm PDT by
Every year between 2015 and 2024, at least one Apple executive agreed to be interviewed by Daring Fireball's John Gruber for a special WWDC episode of his podcast, The Talk Show. Last year, for example, Apple's software engineering chief Craig Federighi, marketing chief Greg Joswiak, and top AI researcher John Giannandrea joined Gruber on stage at the California Theatre in San Jose to discuss...

Top Rated Comments

bawbac Avatar
140 months ago
Now we know what GT standard for, Grand Theft.
Score: 51 Votes (Like | Disagree)
Rudy69 Avatar
140 months ago
I'll let you guess who was spreading rumours that the next iPhone was going to use a sapphire screen. And they had a planned sale of stocks just before the iPhone announcement.... what a coincidence :eek:
Score: 33 Votes (Like | Disagree)
VulchR Avatar
140 months ago
Management gets millions... workers get unemployed. Because it's the management that take risks. :rolleyes:
Score: 33 Votes (Like | Disagree)
mad3inch1na Avatar
140 months ago
That CEO sure sounds legit...
Score: 33 Votes (Like | Disagree)
iSee Avatar
140 months ago
GT Advanced's deal with Apple was highly favorable to the Cupertino-based company, with the sapphire supplier taking on all of the risk.

Seems like Apple took on plenty of risk. We'll see how much of that $440 million they get back.
Score: 29 Votes (Like | Disagree)
iLoveiTunes Avatar
140 months ago
Oh boy... this screams insider trading
Score: 28 Votes (Like | Disagree)