TAIPEI—Apple Inc. has placed orders for key components used in a next-generation iPhone it is preparing to launch sometime in the third quarter, according to people familiar with the situation.
According to some suppliers of components to Apple, the new version of the iPhone is expected to be thinner and lighter than the iPhone 4 and sport an eight-megapixel camera.
Apple, like many other big personal-computer and consumer-electronics brands, doesn't actually make most of its products. It hires manufacturing specialists—mainly companies from Taiwan that have extensive operations in China—to assemble its gadgets based on Apple's designs. They use parts from other outside suppliers, many of which also are from Taiwan and elsewhere in Asia. The arrangement frees Apple and its fellow vendors from running complicated, labor-intensive production lines, while the ability of Taiwanese companies to slash manufacturing costs helps cut product prices over time.



"Apple's sales estimate of the new iPhone is quite aggressive. It told us to prepare to help the company meet its goal of 25 million units by the end of the year," said another person at one of Apple's suppliers. "The initial production volume will be a few million units... we were told to ship the components to assembler Hon Hai in August."
Carolyn Wu, a spokeswoman for Apple in Beijing, declined to comment. A spokesman for Hon Hai Precision Industry Co. declined to comment on the new iPhone.
Hon Hai, based in Taiwan, is the world's biggest contract manufacturer of electronics by revenue and is the global assembler for Apple products.
Two of the people, however, cautioned that shipments of the new iPhone could be delayed if Hon Hai can't improve its yield rate, as the new iPhone is "complicated and difficult to assemble."

Last month, Hon Hai Chairman Terry Gou said at the company's annual general meeting that the yield rate of Apple's touch-screen devices hasn't been satisfactory, which weighed on Hon Hai's profitability.
"The touch-screen devices are so thin. It's really difficult to install so many components into the iPhones and iPads," Mr. Gou said. "We hope to raise the yield rate and volume in the second half which will help improve our gross margin."
Apple's iPhone has led much of the cellphone industry's innovation since the device was introduced in 2007. Apple said in April that it sold 18.6 million iPhones in its fiscal second quarter ended March 26, more than double the year-earlier tally. That figure was also 15% higher than the December quarter, which is typically Apple's strongest periodsince it is fueled by holiday sales.