Samsung Display to supply OLED panels for Apple’s new iPhones

[Photo by Samsung Display]

Samsung Display Co., South Korea’s leading display maker, signed a contract to supply Apple Inc. a large volume of organic light-emitting diode (OLED) panels, further cementing Samsung Display’s position in the small- and mid-sized OLED panel market. The deal also hinted a sign of improvement in soured relations between the Korean display maker’s sister company Samsung Electronics Co. and Apple following their five-year-long patent war. 

According to a person familiar with the matter on Thursday, Samsung Display struck a deal with Apple early this month to provide about 100 million units of 5.5-inch OLED display for the next-generation iPhones annually starting May next year. It is said that the Korean display maker was guaranteed to supply Apple its OLED panels for three years. 

Samsung Display will add production lines that will be dedicated to Apple’ orders at its A3 factory in Asan in Korea. The A3 fab is built solely for manufacturing flexible OLED panels, boasting a monthly production capacity of 15,000 sheets of the 6th generation panel (1850 millimeters x 1500 millimeters). The display maker invested in the factory to double its annual production capacity to 30,000 sheets early this year. 

However, to meet the Cupertino, California-based tech giant’s demand, the A3 factory should churn out up to 120,000 sheets a month, suggesting that it may be required to inject over 10 trillion won for the factory expansion. 

Apple is expected to apply the OLED display supplied from Samsung Display to the next iPhone slated for launch in the latter half of next year. Market watchers project that the flexible OLED panel that can be bent or folded will allow Apple to roll out the next iPhones in a totally new form factor. 

Following the latest deal, Samsung Display is expected to further solidify its footing in the small- and mid-sized OLED display market. According to a global market research firm IHS Inc., the entire OLED display market is forecast to nearly double to $25.4 billion in value over the next five years, from the current $14.5 billion this year.

By Lee Seung-hoon