Reliable sources from Apple's foreign supply chain say the company's next-generation smartphone, the iPhone 5, is ready to begin production.

A source from within China's Foxconn manufacturing plant told 9 to 5 Mac various sample devices of the iPhone 5 are floating around the floor, but there are a number of common features among the phones, including a display that measures at least 4 inches, and a longer and wider form factor that does not match that of the iPhone 4 or 4S. The iPhone 5 will also reportedly retain the rectangular shape of its predecessors, putting to bed rumors of a thinner teardrop shape.

The source did not outline Apple's production timeline, but if Foxconn begins building the phones now, given the five-month lead time required to prepare the product, consumers can expect the iPhone 5 to arrive in June or July 2012.

Previous reports have said the Apple iPhone 5 will feature an improved version of Siri, the voice-activated AI system that was only released as a beta in the iPhone 4S, as well as a bigger screen. In November, Hitachi and Sony reportedly began shipping 4-inch LCD panels for final production of new iOS devices believed to be the next-generation iPhone. Upgrading the iPhone's 3.5-inch screen to a 4-inch display would require a rebuilt Retina Display, but a bigger screen would help Apple compete against phone makers that make bigger screens, such as Samsung, while also providing a more immersive iPhone experience.

Before Apple unveiled the iPhone 4S on Oct. 4, the Internet was flooded with photos of a thin, large-screen iPhone 4. The photos were widely believed to be doctored until one Chinese website discovered mold engineerings of an iPhone 4 with a noticeably larger screen. The renderings depicted an edge-to-edge design for the iPhone's screen, which looked to measure about 3.7 inches. Component industry trackers believed that the images represented Apple's wish to compete with rival devices with bigger screens.

Apple wants its next generation of mobile devices to look beautiful, and the company is reportedly working on giving its devices greater pixel density. Bigger screens with more pixels in the Retina Display mean higher resolution for watching movies and viewing detailed images, from PDFs to X-rays to MRIs to 3D architectural renderings. Even text will appear rich and razor-sharp. Sources say Apple's next iPad will reportedly outshine the current model by doubling the pixel density, with a display resolution somewhere in the ballpark of 2048 x 1536 pixels.

Apple's next iPhone may also include a number of the company's recently granted patents, including NFC functionality to complete sales transactions and share work across multiple devices, as well as its crack-resistant glass solution. A shock mount between the glass and the body of the device will instantly inflate if the device senses it's falling, which is determined by the device's internal accelerometer. An actuator within the device sucks in the cover glass as it accelerates to the ground, protecting it from damage.

The next iPhone will also reportedly feature 4G LTE, according to Will Strauss, president of market research firm Forward Concepts. LTE, which stands for Long-Term Evolution, features significantly higher download and upload speeds compared to 3G technologies, but the current implementations of LTE in phones appear to cause very short battery life, which is a major complaint by users.

If Apple wanted LTE in its prior iPhones, it would have been forced to increase the phone's thickness to accommodate a larger circuit board and a bigger battery. Apple CEO Tim Cook, in a company earnings conference call in April 2011, said that first-generation LTE chipsets force a lot of design compromises.

Luckily for Cook and Apple, Qualcomm is reportedly developing a new, thinner LTE chipset, which is considerably smaller than current LTE chipsets. The new chip is expected to debut in the second or third quarter, but Apple may try to hasten the process so LTE is included in time for its next iPhone.

On Tuesday, Cook released Apple's record-breaking Q1 2012 earnings, announcing $46.33 billion in overall earnings, $13.1 billion in profit and $17.5 billion in cash for the quarter that ended Dec. 31, 2011. In the last 14 weeks of the year, Apple sold 37 million iPhones, 15.4 million iPads and 5.2 million Macs.

We're thrilled with our outstanding results and record-breaking sales of iPhones, iPads and Macs, Cook said. Apple's momentum is incredibly strong, and we have some amazing new products in the pipeline.

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