Apple’s reduced iPhone sales have domino effects on makers of Apple peripherals. A case in point is Japan Display, a company that manufactures LCD for Apple.
Notably, Apple has shifted its focus to OLED with the launch of iPhone X, XS, and XS Max. In Apple’s current line of smartphones, only XR flaunts LCD.
LCD Display Maker Japan Display Reports Ninth Straight Quarterly Net Loss
Japan Display is already facing capital issues, and this time, the company posted a ninth consecutive quarterly net loss on Wednesday.
This quarterly net loss is a result of weaker-than-expected demand from Apple, which is the biggest client of Japan Display.
The display maker is in conversation with a Chinese-Taiwanese group regarding a bailout. However, the group is keeping a close eye on the results.
Notably the Chinese-Taiwanese group “delayed an up to 80 billion yen investment this week in order to reassess the company’s prospects,” according to Reuters.
The fourth quarter loss of Japan Display was 98.6 billion yen ($899.22 million), compared with the 147 billion yen loss a year earlier.
Net loss of display maker for the entire year is 109.4 billion yen, which is worse than an average estimate of 13.47 billion yen loss from six analysts surveyed by Refinitiv.
Following the reduction in the value of assets on one of its panel plants (75.2 billion yen), the company would lay off nearly 1000 workers or about a tenth of the group’s workforce.
If the bailout works out, the buyers, which include Taiwanese flat screen maker TPK Holding Co Ltd and Chinese investment Harvest Group, will become the biggest shareholders with a 49.8% stake. This will replace the Japanese government-backed INCJ fund.
A delay in bailout can push Japan Display in a tight corner as the company might have to face survival issues. Interestingly, the screen maker was formed in 2012 by combining the liquid-crystal display (LCD) businesses of Hitachi Ltd, Toshiba Corp, and Sony Corp.
For the last few years, Apple has been a major client for Japan Display, which is now suffering because of Apple’s shift to OLED screen. Sensing this shift, the screen maker is exploring new horizons like sleep-tracking sensors. Japan Display is also planning to supply OLED screens for the future Apple Watch Series 5.
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