Samsung slashes OLED production

UPROXX  Apple

Anticipating strong demand from Apple, Samsung Display had made a capital investment of $12.6 billion last year, which resulted in $1.4 billion jump in depreciation costs in the current year.

Samsung has big plans for its mid-range smartphones, it seems.

According to market research firm IHS, Samsung Display made up 97.8 percent of the smartphone OLED market globally in the third quarter previous year. Previously, it has been estimated that Samsung itself makes $110 off of each iPhone X sale.

The production cut was reportedly prompted by slower-than-expected sales in the holiday shopping season in Europe, the U.S. and China. For now, Samsung Display is the sole supplier for the current iPhone X. Samsung Electronics uses OLED for nearly 70 percent of smartphone models. On a facility that Samsung Display had dedicated to producing panels exclusively for Apple's use, it could see production rates drop to half or less. Japanese companies like Hodogaya Chemical Co and Hirata Corp also saw shares fall. Business is good if Apple's expensive flagship phones are flying off the shelves, but with the iPhone X not looking like it would sell as much as the company would expect, an issue has come up on the supply side of things as well.




And this is just for the January-March quarter, there may be additional cutbacks for April-June.

AAPL stock fell 0.89% in pre-trading.

In an earnings call with investors earlier this month, Cook shrugged off sales concerns and declared that the iPhone X has set Apple up "for the next decade." Last week, Apple informed developers that all new apps submitted to the App Store must support the iPhone X's edge-to-edge display.

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