Samsung left with excess OLED capacity after Apple slashes iPhone X production by half

Though Tim Cook has claimed that iPhone X has been the top-selling smartphone for Apple every week since its release, Samsung seems to be offering up a different side to the story. The South Korean giant, who has been manufacturing the OLED displays found on the iPhone X, has reportedly said that they have been left with excess OLED capacity after Apple cut down iPhone X production by 50 percent.

Apple iPhone X. Image: tech2/ Rehan Hooda

Apple iPhone X. Image: tech2/ Rehan Hooda

A report by Japanese publication Nikkei states that Samsung had ramped up the production of OLED panels to meet initial iPhone X demand. But now with the production cut down, Samsung has been left with excess capacity and is looking for buyers.

Samsung's panels cost $100 each to make, almost double that of a traditional LCD panel. The high cost of OLED panels is why many smartphone makers have not switched from the traditional LCD panels.

The report claims that the production of the iPhone X has been halved in this quarter due to poor sales in the holiday season. Apple sold 77.3 million iPhones in the holiday quarter, about 1 million fewer than at the same time in the previous year, which included an additional week because of a quirk in the calendar. Despite the smaller window of time, analysts had predicted Apple that would sell 80 million iPhones in the past quarter.

Samsung may also risk losing the contract for manufacturing further OLED panels for the upcoming iPhones in 2018 as the Cupertino giant may opt to go with LG instead. The report also notes that Chinese companies are ramping up OLED production, which might force Samsung to bring down the price of its own panels.

Published Date: Feb 19, 2018 17:56 PM | Updated Date: Feb 19, 2018 17:56 PM