The analyst said that Finisar's recent financial disclosures indicate that Apple is going to use its VCSEL tech in more iPhones next year, suggesting that all of next year's iPhones will get all-screen designs complete with Face ID cameras.
The investment will enable Apple to "get better supply and better pricing, and it makes it more hard for Android phones to compete", said Gene Munster, a longtime Apple watcher at Loup Ventures.
'VCSELs power some of the most sophisticated technology we've ever developed and we're thrilled to partner with Finisar over the next several years to push the boundaries of VCSEL technology and the applications they enable, ' said Jeff Williams, Apple's chief operating officer.
Finisar is not the first company to benefit from the fund - that honour went to Corning, which makes the durable Gorilla Glass displays that feature on many phones. Finisar, a company that manufactures vertical-cavity surface-emitting lasers (VCSELs), is receiving $390 million as part of Apple's new program to fuel job creation among American manufacturers.More news: Wreaths across America, Dec. 16
"We're excited to continue our innovation with Apple of a technology that has tremendous potential", said Jerry S. Rawls, CEO of Finisar.
The opening of the plant in Texas comes after President Donald Trump heavily criticized Apple and other American companies for building their products overseas.
The design process at Apple balances creating ground-breaking technology against the manufacturing challenge of finding suppliers who can provide the number of components needed to put new features inside hundreds of millions of handsets. Finisar is planning to open a manufacturing plant in Texas to create the VCSELs that Apple requires for its products.
When combined with the company's nearby plant in Allen, Texas, Finisar's payroll in Northern Texas is expected to be $65 million.More news: USA says hacker to plead guilty for role in 2016 cyber attacks
In the fourth quarter of 2017, Apple will buy 10 times more VCSELs than were previously made worldwide over a similar time period, it said.
A Finisar technician examines a wafer during production.
500 people will be hired to help build the TrueDepth cameras for the current iPhone X model. Well, look for (or don't) more of that invisible magic in the future.
How do you rate laser-based features like Face ID and Animoji?More news: Comcast drops bid for Fox assets, leaving Disney in pole position
Five unsuccessful attempts at Face ID will force you to enter a passcode - which you'll need anyway just to set up facial recognition.
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