A number of analysts believe that it will not be easy for Apple to switch over to OLED panels entirely for its 2019 iPhone lineup. Apple switched over to an OLED panel for the iPhone X last year, and it will reportedly be launching two new iPhones this year featuring OLED panels. They will be accompanied by a cheaper third LCD model with the same design.
JPMorgan Jay Kwon believes Apple’s transition to OLED panels for its 2019 iPhone lineup is unlikely as OLED panels are expensive thereby increasing the overall cost of the devices. This, in turn, will defeat the entire purpose of launching a cheaper LCD model this year.
Then there’s also the fact that Samsung is the only major OLED supplier in the market right now. Given that Apple sells upwards of 200 million iPhone units every year, it is simply not practical for the company to rely on a single vendor for such a key component across its entire 2019 iPhone lineup. While LG Display and a few smaller Chinese OEMs have also managed to start producing OLED panels, their quality and quantity are far below that of Samsung. If Apple does end up making the switch, it would end up creating a scarcity of OLED panels in the market thereby pushing their prices up for almost every other OEM in the market.
Analysts from Yuanata Securities Investment Consulting and Goldman Sachs Group echoed similar sentiments and cast a doubt on Apple making the transition to OLED panels for its 2019 iPhone lineup.
Goldman Sachs Group Inc. analysts were also skeptical, citing recent financial guidance from companies including Japan Display that suggested continued use of LCD technology.
“We think it is unlikely that all 2019 iPhone models will switch to OLED screens and we believe share prices have overreacted,” analysts Daiki Takayama and Jie Dai wrote in note.
While Apple does plan on switching over to OLED panels entirely for its iPhone lineup, its unlikely to happen with the 2019 iPhone lineup. Analyst Jerry Kang of IHS Markit believes that even with the iPhone X, Apple was not able to expand its production due to market demand and price issues. This is certainly true as Apple paid a heavy premium for the OLED display of the iPhone X. Reports claim it paid Samsung around $130 per unit for the iPhone X’s 5.8-inch OLED panel. For its 2018 iPhone, Apple has asked Samsung to reduce the prices so as to allow it to price the handsets lower.
Apple has been trying to get LG Display to manufacture OLED displays by investing heavily in it. However, the latter continues to struggle for now, with the quality of its OLED panels also being sub-par.
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