LCD screen iPhone XR sales are weak, Japanese media reveal that JDI still owes Apple about $1.5 billion

The trend of folding screen mobile phones has really added a fire to the stock prices of LCD for Samsung panel manufacturers, but on the other hand, traditional LCD panel manufacturers are not easy.

According to the Japan Times report, in 2015, Japan Display Inc. (hereinafter referred to as JDI) broke ground on a new factory in central Japan. For this reason, Apple JDI paid US$1.5 billion for help. In return, JDI will pay Apple a certain percentage of screen revenue. However, after four years, market changes almost paralyzed JDI's market performance.

LCD for Samsung has become a popular choice for flagship phones

According to sources from the company, JDI still owes Apple most of the construction costs. He declined to disclose the specific amount. Two people familiar with the matter pointed out that JDI is seeking financial help from China. This transaction will allow the Chinese group to obtain a nearly majority stake in exchange for an investment of 500 million to 700 million US dollars. The group plans to use Japanese display technology to build OLEDs in China. Panel factory.

JDI’s predicament shows that the weak iPhone sales and the weak smartphone business market are causing pain for the entire Asian electronics supply chain.

'It is very cost-effective to mass-produce components of one model (iPhone),' another Apple parts supplier believes, 'At the same time, we face a huge risk of volatility.'

JDI has established partnerships with other smart phone manufacturers, including China's Huawei, OPPO and Mi. But with weak sales growth, Chinese companies turned to domestic panel manufacturers, such as BOE and Tianma Microelectronics, which also greatly improved their screen quality.

According to research institute IHS Markit, JDI provided nearly one-third of Huawei’s smartphone screen components in 2015, but as Chinese companies turn to BOE and Shenzhen Tianma, JDI's share fell to 4% in the third quarter of last year.

JDI was established in 2012, led by the Japanese government, and merged with the display divisions of Sony Corporation, Toshiba Corporation and Hitachi Corporation. Although the new CEO Nobuhiro Higashiiriki announced a full shift to OLED. But the company has fallen behind its competitors and still needs more cash for LCD for Samsung investment. As the only LCD screen this year, the iPhone XR sales were weak, which once again hit JDI.

'We have no other choice,' a source at the company said, adding that the Japanese government has been silent on JDI's rescue plan. 'They may argue that when Chinese panel makers are adding more display devices, display technology is not something that Japan must keep and protect.'