In the fall of 2017, Apple (NASDAQ: AAPL) introduced three new iPhones -- iPhone 8, iPhone 8 Plus, and iPhone X. The iPhone 8 and iPhone 8 Plus both use liquid crystal displays (LCD) -- a proven and widely available display technology that has been used in all prior-generation iPhones.
On the other hand, the iPhone X uses a different type of display technology known as an organic light-emitting diode (OLED). It has several advantages over LCDs, such as richer color saturation, much higher contrast ratios, and quicker response times. However, OLED displays do suffer some drawbacks compared to LCDs, such as significant color shifting at wide viewing angles, higher manufacturing costs, and limited supplier choice.
Image source: Apple.
The displays used in the iPhone X are believed to be supplied exclusively by Samsung (NASDAQOTH: SSNLF) Display, which is thought to be the only display manufacturer capable of cranking out displays at the quality levels and in the quantities that Apple needed to support the iPhone X product cycle.
According to a new report from Electronic Times(via MacRumors), Apple is planning to add LG Display (NYSE: LPL) as another supplier of OLED displays for its next-generation iPhone lineup.
LG Display and the next iPhone X
Next year, Apple is expected to equip two of its three flagship iPhones with OLED displays. The successor to this year's iPhone X is expected to sport a similarly sized OLED display as the one on the current iPhone X. Apple is also expected to augment its iPhone product line with a larger-screen version of that iPhone X-successor.
Put simply, for its next iPhone product cycle, Apple is going to need far more OLED displays.
Samsung Display is, of course, expected to supply the bulk of those displays to Apple, which means that Samsung Display should still enjoy Apple-related OLED display shipment growth even if it loses some share to LG Display.
However, the Electronic Times report indicates that LG Display is set to supply between 15 million and 16 million OLED displays to Apple in support of the next-generation iPhone lineup.
Perhaps more interestingly, a translation of the report says that the "panel for the iPhone to be supplied by LG Display is known to be 6.5-inches."
A sensible supply chain move
The impression that I get from this report (admittedly, the translation is a little bit rough) is that Samsung Display will be the sole source of the panels for the next-generation 5.85-inch iPhone X while both Samsung and LG Display will supply panels for the 6.46-inch next-generation iPhone X.