Japan Display to Raise $517 Million to Supply Apple With LCDs for 2018 Low-Cost iPhone

Discussion in 'iOS Blog Discussion' started by MacRumors, Mar 30, 2018.

  1. MacRumors macrumors bot


    Apr 12, 2001

    Japan Display is planning to raise $517 million through third-party share allocations and asset sales so it will have the funds to supply LCD screens for new iPhones, reports Nikkei.

    Last year, Japan Display lost business because of Apple's shift to OLED, so the company sought partnerships to begin producing OLED displays, but with Apple planning to continue to use LCDs for some devices, Japan Display is in need of working capital to purchase inventory and to begin production on the LCDs Apple now needs.


    Rumors have suggested Apple is planning on introducing two OLED iPhones (5.8 and 6.5 inches) and one 6.1-inch LCD iPhone next year, with the LCD device to be positioned as a low-cost option alongside the two more expensive OLED devices.

    With Japan Display again planning to invest in LCDs, it could be in trouble in the future should Apple opt to abandon LCD technology for OLED technology entirely, says Nikkei.
    Previous rumors have suggested Apple is interested in Japan Display's Full Active LCDs, which are said to match or exceed some of the advantages of OLED at a lower cost.

    Full Active panels have a smaller bezel around the screen than traditional LCDs and they have enough flex that they can be used in curved or angled designs.

    All three of Apple's rumored 2018 iPhones are expected to adopt full-screen designs with minimal bezels, much like the iPhone X. The Home button will be eliminated in each, with Apple adopting Face ID across its 2018 iPhone lineup.

    Article Link: Japan Display to Raise $517 Million to Supply Apple With LCDs for 2018 Low-Cost iPhone
  2. Glideslope macrumors 603


    Dec 7, 2007
    A quiet place in NY.
    Congratulations to Japan Display. Hope it works out. :)
  3. chfilm macrumors 68000


    Nov 15, 2012
    It’s sad that the iPhone X doesn’t receive the appreciation by buyers that it deserves. It’s a truly amazing iPhone!
    But then again I’m glad that it flopped, hopefully forcing Apple to bring that ridiculous price down again!!!
  4. yanksfan114 macrumors 6502

    Jul 30, 2011
    "However, the iPhone X has proven a flop"

    Lol what?
  5. GrumpyMom macrumors 604


    Sep 11, 2014
    The iPhone X officially flopped? By what measure? Its notchy design spawned an entire generation of Android clones, much to my dismay as someone who also appreciates Android hardware for its differences from iPhones.

    I had an X and I don’t think Apple got the best OLED displays Samsung is capable of making. I don’t know if it was Apple’s specifications at fault or something Samsung did, but the pwm flicker did my eyes in. And I saw some ugly variances in display color temperature and quality among different X’s. Owning the refined S9+, I know OLED quality doesn’t have to be that varied anymore. Every S9+ I’ve seen so far has been uniformly excellent and without the weird flaws I noticed when the S8’s were first released. Nor does OLED have to cause migraines and eye strain.

    I don’t plan to get one, but I do hope the next generation of IPhones get some spectacular displays that truly show off the best that their respective technologies are capable of.

    And even though I personally didn’t get along with it, nor the cost, I find it hard to believe the X flopped. I think people are just holding onto their phones longer. A lot of people I talked to don’t want to give up their 6 and 6s models because it means giving up the headphone jack. Those are excellent phones and with new batteries in them, many owners I chatted with seem quite happy.
  6. tito2020 macrumors 6502a

    Oct 16, 2011
    samsung stop making oled lots of screen burn issues.
  7. PickUrPoison macrumors 68040

    Sep 12, 2017
    Sunnyvale, CA
    Nikkei doubling down on their flop nonsense.
  8. Onexy macrumors regular


    Sep 14, 2012
    Why does a company need to raise money when they are supposed to get paid from Apple?
  9. Shaun, UK Suspended

    Shaun, UK

    Mar 23, 2006
    Apple have only themselves to blame if Samsung are palming off sub-standard OLED displays.

    How on earth Apple reached a position were they are solely reliant on their biggest competitor for such a key component is beyond me. It’s bad management pure and simple.

    I’ve said for years that Apple should develop and produce their own components.
  10. Rocketman macrumors 603


    Raising capital in Japan is dirt cheap. Japan is an advanced economy unlike the other options. Glad they can do it at all.
  11. Spock macrumors 68000


    Jan 6, 2002
    All I read was the home button will be iliminated, it’s just my opinion and it’s a strange one to have I guess but if I can’t get an iPhone with a home button then my iPhone 8 better last me a while. I love the home button and Touch ID
  12. pika2000 macrumors 601

    Jun 22, 2007
    Well, imo the X actually is more successful than it was intended to. I am seeing more and more X in the wild than I expected, and I'm living in a developing country. It is quite ridiculous knowing the X's price, but it shows the appetite of the Apple brand.

    Imo Apple didn't intend the X to be a "huge" success to begin with. The flagship was supposed to be the iPhone 8. The X was the bleeding edge early adopter phone, thus Apple upping the price to $1k. It was a new design, no home button, new tech with low yield, etc etc. Aka Apple wants to test the market. But lo and behold, the market didn't swat an eye on the $1k price.
  13. JosephAW macrumors 68020


    May 14, 2012
    It's only a flop if the industry doesn't clone Apple's iPhone X look.
  14. madKIR macrumors 6502a

    Feb 2, 2010
    Nikkei, stop trying to make flop happen, it’s not going to happen! lol
  15. jecowa macrumors regular

    Mar 15, 2006
    • Apple had to slow down production of the X after sales didn't meet expectations. They scaled back their orders for OLED displays from Samsung after previously making Samsung expand their OLED production capabilities.
    --- Post Merged, Mar 30, 2018 ---
    I'm glad for the improved LCD being used in the 6.1-inch X. The OLED models are so sexy with pure blacks that are super power efficient. But if the 6.1-inch LCD model is a lot cheaper than the 6.5-inch OLED model, I'll probably get it instead.
  16. mtneer macrumors 68030


    Sep 15, 2012
    This seems so counterintuitive. If OLED is going to be the technology of the future, why on earth is Japan Display investing $500+ million in previous generation LCD technology lines? If they had been Apple's LCD supplier in the past, they ought to have the technology and capacity to keep LCD production going. In fact I would have expected them to invest this money in OLED research.
  17. riteshritesh macrumors member

    Mar 18, 2016
    Mumbai INDIA
    They would get paid in full, after they supply and to get the supply going, they need working capital. Thus the money requirement.
  18. PickUrPoison, Mar 30, 2018
    Last edited: Mar 31, 2018

    PickUrPoison macrumors 68040

    Sep 12, 2017
    Sunnyvale, CA
    We’ve read the rumors. But they’re completely at odds with the facts.

    On November 2, 2017, Apple provided guidance for FY18Q1 (Oct-Dec 2017) of between $84-87 billion. They announced this past February that they beat that estimate, posting record sales of $88.3 billion.

    That doesn’t sound like a company that is incapable of estimating their demand and needs to scale back orders. That’s a company that nailed their sales projections and knows exactly how many displays they need.

    There’s always a production cut in the second quarter, since sales are much, much higher in the Oct-Dec quarter vs the Jan-Mar quarter. That’s true every year, and is well known. Completely expected; iPhone sales are highly seasonal. In FY2017 for example, Apple’s FY1Q iPhone revenue dropped from $54 billion to $33 billion in FY2Q.

    So what’s important is the magnitude of the production cuts. It could very well be that they’re lower than last year, i.e. X sales might actually be holding up better than did iPhone 7 sales.

    In February, Apple guided for $60-62 billion for their Q2 (Jan-Mar) revenue. This is 13-17% higher than the year ago quarter of $53 billion, which in no way supports the Nikkei narrative of an iPhone X “flop”. (The record $88.3 billion Q1 revenue was 13% higher than the same quarter revenue last year, $78.3 billion.)

    Tl;dr: No unanticipated production cuts, both last quarter’s 13% revenue increase and this quarter’s projected 13-17% revenue increase clearly indicate Apple is expert at predicting their demand. And disproves any “flop” narrative.
  19. JPack, Mar 30, 2018
    Last edited: Mar 30, 2018

    JPack macrumors 68040


    Mar 27, 2017
    It’s counterintuitive because few people expected the relatively poor sales of iPhone X. Back in December and January, every one of Apple’s suppliers in Taiwan and Korea had their stock prices drop after the disappointing projections.

    People here still don’t understand that Apple’s reported 13% increase in revenue is below expectations. It’s +13% compared to the iPhone 7 launch. iPhone X is a 10-year refresh for Apple. It was supposed to be a Big Bang that would last for the next several quarters.

    In 2017, in anticipation of iPhone X, JDI borrowed $897 million and restructured their entire company and production lines to emphasize OLED. They laid off a whole bunch of people with LCD experience.

    With the 6.1” mainstream model, Apple is clearly betting on LCD again. Easy for Apple but tough on suppliers. iPhone X was supposed to cascade down to $899 which would maintain OLED demand. Instead, Apple is heading back to LCD after seeing iPhone X numbers. It’s a WTF moment for JDI.
  20. simonmet macrumors 68000


    Sep 9, 2012
    As a 7 Plus owner I hope to upgrade at some point to the ... iPhone 8!
  21. Applebot1 macrumors 6502a

    Jan 4, 2014
    I don’t have an X but not for one minute it’s a flop. Granted it’s an earlier adopter type of phone due to the new design etc but like Apple said it’s the future of iPhone.

    Going forward we should expect future iPhones and to a degree iPads design language and technology to reflect the X.
  22. simonmet macrumors 68000


    Sep 9, 2012
    Anyone else think 6.1” could be the ideal size? And it won’t get OLED so it’ll be cheaper. Seems like they know that model will compete very favourable with the OLED models.
  23. JPack macrumors 68040


    Mar 27, 2017
    The 6.1" mainstream model is just right for 2018. If we look at Samsung's lineup, the S9 and S9+ are 5.8" and 6.2". A 6.1" device is right in the middle.

    Apple is willing to cannibalize its iPhone X sales by putting Face ID into a $7XX iPhone. I think the chances of a supercycle happening this year are much higher given this new strategy.
  24. democracyrules macrumors 6502a

    Nov 18, 2016
    iPhone X sales flop news is fake news..
  25. Michael Scrip macrumors 603

    Mar 4, 2011
    All this talk about "iPhone X didn't meet sales expectations..."

    I gotta ask: How did Apple think a $999 iPhone would sell?

    In the years prior... current-generation iPhones started at $649 and went up to $949. Everyone has become accustomed to this pricing structure.

    But then Apple throws an additional model into the mix that starts at $999.

    If it was me... I wouldn't set any lofty expectations on the most expensive iPhone ever to be sold. I'd be conservative.

    So again... did Apple really think the iPhone X was gonna be some hot seller as everyone says they did? Apple is usually pretty good with supply and demand... usually erring on the side of "not enough" rather than "too much"

    Or "shortages" rather that "surplus"

    So that's why I find it hard to believe that Apple pre-ordered a bunch of iPhone X parts and then had to cancel a portion of the order at a later date.

    That's the part that bugs me.

    I'll admit that I know nothing about the inner workings of Apple's supply chain. But I do know that electronic parts don't spoil. So if they had a bunch of extra OLED screens from Samsung this quarter... couldn't they use them next quarter?

    Or is that the reduction that everyone is talking about? The orders in future quarters?

    This isn't like ordering a bunch of fish for your restaurant and then having to throw it away because you didn't have enough customers that night.

    Apple would have planned on selling the iPhone X for 12 months. I'd be shocked if they simply guessed some random number of parts to order for the entire year for an entirely new product.

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