O'Grady's PowerPage

Tag: LG Display

  • Rumor: Apple to invest $1 billion in Sharp plant to produce iPhone, iPad LCD units

    A rumor is percolating that Apple is planning to invest US$1 billion in a new Sharp factory for building screens for its iPhone and iPad products has resurfaced, just days after a separate report claimed that the next-generation iPad has been delayed in part because of production constraints from the supplier.

    Per Reuters, MF Global analyst David Rubenstein resparked the rumor in a sales note to clients on Wednesday, giving shares of the Japanese company a lift of more than 2 percent.

    “We think it is highly possible that Apple will make an investment in Sharp’s Kameyama plant to the tune of around $1 billion in order to secure stable supply of screens for iPhones and iPads,” he said, adding that Apple’s investment would have a “material impact on Sharp’s profitability.

    Last December, Japanese business newspaper Nikkei claimed Apple would pay a “large portion” of the 100 billion yen (UD$1.3 billion) required to build a new LCD manufacturing facility and would buy “most” of the panels produced there. Production was said to begin at the plant in the later half of 2012.

    On Monday, a rumor emerged that Sharp’s supply of 9.7-inch 2,048 by 1,536 resolution next-generation iPad displays are insufficient for an iPad 3 launch in 2011. It was noted that the high-resolution displays are “mainly supplied” by Sharp with a high price, and Apple’s other suppliers Samsung Electronics and LG Display are both “unable to reach a good yield.”

    “Due to iPad 3’s requirements over the physical thinness, rich color support and toughness will all conflict with the panel’s technology restrictions; therefore, this could cause a delay in the launch,” the report said.

    LCD displays have reportedly been a limiting factor for both the original iPad and the second-generation model.

    Apple was also said to be helping Toshiba on a new LCD plant last year, but an official with the supplier claimed “nothing had been decided” regarding a new plant. In April, reports claimed Toshiba had become the sole manufacturer of LCDs for the iPhone.

    Stay tuned for additional details as they become available.

  • Apple switches away from LG displays for iPad 2, opts for Samsung, CMI in the near term

    As neat as the iPad 2 is, sometimes thar be hiccups with the suppliers…

    Per DigiTimes, LG Display has reportedly lost its status as the leading iPad 2 display maker after recent LCD shipments were said to have been plagued by quality issues, prompting Apple to turn instead to Samsung.

    Citing industry sources, DigiTimes reported Wednesday that LG, the largest panel supplier for the iPad 2, recently had production of its LCD displays with in-plane switching disrupted by issues. As a result, Apple has allegedly been forced to suspend new orders from LG, turning instead to competitors Samsung and CMI.

    “LGD’s 9.7-inch panels for the iPad 2 reportedly failed to pass drop tests, during which their backlight units (BLUs) failed, the sources said, adding the panels’ yield rates were unable to meet Apple’s requirement,” the report said.

    LG is said to have shipped between 2.5 million and 2.6 million 9.7-inch panels in July, falling short of its goal of 4 million units per month. While LG has struggled, Samsung is said to have doubled its production goals, creating 2 million iPad 2 panels in July.

    Oddly enough, Samsung is a primary competitor of Apple, with the two companies currently involved in a bitter legal battle, which sources said make the company a less-than-ideal choice for Apple. In addition, while CMI’s affiliate status with manufacturer Foxconn makes it a favorable choice for Apple, its monthly goal of 9.7-inch iPad 2 displays is just 1 million.

    In its last quarter, Apple shipped a record 9.25 million iPads, as the company apparently resolved supply constraints that hampered iPad 2 availability immediately after launch. In the previous quarter, the company sold 4.65 million iPads, as the company was plagued by what Chief Operating Officer Tim Cook called “the mother of all backlogs.”

    Given supply constraints faced by Apple in the past, the company may be eager to embrace LG once again if the apparent LCD quality issues can be addressed. Sources told DigiTimes that LG could regain its position as the leading panel supplier for the iPad 2, but only if problems with its displays can be fixed quickly.

    Stay tuned for additional details as they become available.