Samsung to more than halve OLED production due to slow iPhone X demand, Nikkei says
Piling on to its own rumors of slower than expected iPhone X demand, Nikkei on Tuesday said Samsung is drastically slashing OLED output in response to Apple's supposed decision to cut production of the flagship handset.
Samsung is ratcheting down OLED panel output from its South Chungcheong plant to cover 20 million or fewer iPhone X devices for the quarter ending in March, a drastic decrease from an initial goal of 45 to 50 million units, Nikkei reports without citing sources.
According to the publication, the new target reduces plant production to roughly 60 percent of original forecasts, the publication said. In particular, output at Samsung's plant dedicated to OLED-equipped Apple devices will drop by at least 50 percent.
The Korean tech giant has reportedly not set targets for the April-June period, but further cutbacks might be required to correct for what Nikkei in past reports has described as "weak demand."
As a result of the production cut, and reduction of OLED iPhone orders, Samsung's display business is expected to suffer revenue declines for the first half of 2018. Nikkei, again without citing sources, reports Samsung made a 13.5 trillion won ($12.6 billion) capital investment to prepare for what was expected to be a glut of OLED panel orders from Apple.
After claiming Apple was looking to halve iPhone X production in January, Nikkei last week continue to pushed its narrative further, saying weak demand for this year's flagship iPhone was causing a cascade effect on the supply chain. Specifically, Samsung was last Friday said to be in search of new customers after being "saddled with excess production capacity" of OLED panels.
Earlier this month, Apple CEO Tim Cook during the company's most recent quarterly conference call earlier this month said iPhone X was the top-selling iPhone model every week since it debuted in November. While iPhone shipments were down 1.2 percent year-over-year for the first quarter of 2018, in part due to an extra sales week last year, revenue was up thanks to a record-breaking average selling price of $796.42.
Samsung is ratcheting down OLED panel output from its South Chungcheong plant to cover 20 million or fewer iPhone X devices for the quarter ending in March, a drastic decrease from an initial goal of 45 to 50 million units, Nikkei reports without citing sources.
According to the publication, the new target reduces plant production to roughly 60 percent of original forecasts, the publication said. In particular, output at Samsung's plant dedicated to OLED-equipped Apple devices will drop by at least 50 percent.
The Korean tech giant has reportedly not set targets for the April-June period, but further cutbacks might be required to correct for what Nikkei in past reports has described as "weak demand."
As a result of the production cut, and reduction of OLED iPhone orders, Samsung's display business is expected to suffer revenue declines for the first half of 2018. Nikkei, again without citing sources, reports Samsung made a 13.5 trillion won ($12.6 billion) capital investment to prepare for what was expected to be a glut of OLED panel orders from Apple.
After claiming Apple was looking to halve iPhone X production in January, Nikkei last week continue to pushed its narrative further, saying weak demand for this year's flagship iPhone was causing a cascade effect on the supply chain. Specifically, Samsung was last Friday said to be in search of new customers after being "saddled with excess production capacity" of OLED panels.
Earlier this month, Apple CEO Tim Cook during the company's most recent quarterly conference call earlier this month said iPhone X was the top-selling iPhone model every week since it debuted in November. While iPhone shipments were down 1.2 percent year-over-year for the first quarter of 2018, in part due to an extra sales week last year, revenue was up thanks to a record-breaking average selling price of $796.42.
Comments
Like I said before, analysts should be prosecuted and jailed for stock manipulations.
Notice how they didn't get traction on the 16th and now their shoveling it back out again for another go at shorting.
Considering the S9 will likely tank hard and with overall smart phone sales going down from all other android oem, it's much more that Samsung is going to be in deep doo doo. If Apple decides to go with LG for the next X, it will be even worse.
Basically, they shove Apples name in there cause saying Samsung will take a hit is not clickbait worthy, lets pull crap outta our ass and make a buck too they say.
So either the iPhone X is selling incredibly well or it's not and the iPhone 8 and 8+, which were released on 9/22 sold far better than previous models.
So of course these projections are always comically wrong, sometimes they over project, often they project far below - likely the result of the various facilities that build each part prior to final assembly, often with many facilities working on varying batches.
If making predictions (and not just headlines) we must also take into account seasonal change. If the drop is an accurate portrayal, is that the result of the transition from the holiday quarter, or a more meaningful dip? Or perhaps indicative that Apple has moved to other suppliers as already rumoured with LG.
At this stage it's borderline stock manipulation.
After the hype people realized that the X is not a great phone. It’s good, but it’s not great. Apple charged $250 extra to provide a solution for a problem that didn’t exist.
So have I got this right - the flagship iPhone which was too expensive and was going to be a flop was expected to sell 45 to 50 million units in the March quarter (65% of the number of iPhones sold in the holiday quarter) and in a smartphone market that is contracting, this reduction in OLED output is only down to Apple??
This is quite dubious. Apple does not use out of the shelf OLED screens from Samsung. Apple uses custom designed screens and get them produced by Samsung’s manufacturing. How can then Samsung just retarget those screens to any other customers? This would mean that they are violating Apple’s IP by giving it to competitors.
Nikkei has had been for a while trying to spread fud about Apple for reasons that are obscure. Nikkei being a Japanese organization with close relations to Japanese corporations, it would not be surprising that they are trying this sort of manipulation to destabilize the competition of the local Japanese manufacturers which have been quite clueless on how to compete against Apple in terms of innovation.
That’s why I am not sure it makes sense to even report what Nikkei says at this point. They come up with totally unverified figures, eg. where the 45-50 million units figure comes from? And even they were shown to be wrong on their doom predictions about Apple at last quarter results, they continue to come up with what can only be called bullshit. This is troubling to say the least. They are the same by the way that last year insisted that the iPhone X will have a Touch ID on the back of the phone.
Incidentally, my wife's uncle didn't even ask the price before he bought the X. He saw the 8 was around £800 so assumed the X was maybe £100 higher, got his email receipt once home... over £1200! He's not a tech geek, doesn't even use the phone for anything other than calling/texting/betting so it's a waste but it's his money to throw away lol.
Yes, this is what they’re trying to tell us: Apple is the only company making phones with Samsung screens. Not even Samsung is using Samsung screens. 😱
Apple already made clear that the iPhone X is a top seller. If you continue not to believe them, in fact Apple captured a record 51 percent share of revenue in the worldwide smartphone industry last quarter. This is clear that the iPhone X with a higher selling price is driving such massive revenues.
Fire these jokers and bring in Guy Kawasaki to restore the real Apple spirit.
The media and businesses do it for money, but what’s really getting old is the constant hate and bashing by user of other platforms. The team mentality in technology is old an tiresome. I’m sure all companies like it, but it’s foolish.