Not selling enough iPhones doesn’t just hurt Apple, it also hurts its suppliers. And that includes Samsung Display.
According to ETNews, Apple could be looking at “hundreds of billions of won in penalties” for not buying enough OLED screens. That would be around $90 million USD in fines. Obviously that’s chump change to Apple, and it’s also unlikely that Apple will actually hand over that cash to Samsung.
Apple likely will hand Samsung a new contract for OLED displays. This definitely seems to be the case, seeing as Apple is rumored to go all OLED next year on its iPhones. As well as introducing OLED to the Mac, for the first time. And that would mean that Apple would be needing more OLED screens from Samsung, even if iPhone sales don’t improve.
Falling iPhone sales have been hurting Samsung Display in the last few years. In 2017, it raked in about 5.7 trillion won (around $4.9 billion USD), that fell to 2.62 trillion won (about $2.2 billion USD) in 2018.
For a company like Samsung, the slowdown in smartphone sales is hitting it pretty hard. It was already the biggest smartphone maker, so slowing down of smartphone sales is hitting Samsung Mobile pretty hard. But Samsung also makes components found in just about every other smartphone on the market. From displays, to chipsets, to batteries and everything in between. With other companies also feeling the pinch in the smartphone world, it’s making it tougher on Samsung’s family of companies: Samsung Display, Samsung Mobile and Samsung SDI.
The iPhone isn’t the only smartphone that has been suffering from the plateau in smartphone sales in the past few years. It’s actually hitting every player in the market. But since Apple is number two worldwide, and only makes about three different models, that equates to a much higher number of smartphones that Samsung is supplying screens for, than any other player. Including its own smartphones.
This fine means that Samsung and Apple will continue to work together for the next few years though. As the last thing Apple wants to do is pay Samsung millions for selling less iPhones. And this could also turn out to be a good thing for Apple’s customers. As this is likely going to mean no more LCD iPhones, like the iPhone XR. And it also means OLED is coming to the Mac.
OLED on laptops is something pretty new in the past year or so. A couple of PC makers have added OLED to their high-end laptops, like Razer and Dell. an OLED display on a laptop is going to look amazing, since that is the display you probably look at more than your smartphone. And you’re going to get richer colors as well as deeper blacks on this screen, compared to the others screens that are on laptops these days.
In the past few years, we’ve seen OLED become almost a staple on smartphones. Not only from Samsung, as LG is also starting to sell its OLED panels for smartphones, including its own smartphones.