LG Display Starts Shipping LTPO Displays for iPhone 14
Samsung Display (pvt) has been the exclusive supplier of LTPO based displays to Apple (AAPL) since the company began using the more advanced TFT process for two models of the iPhone 13 last year. As high screen refresh rates are desired by consumers to keep fast moving images from smearing, device designers also had to deal with the fact that those higher refresh rates mean the images on the screen are redrawn more often each second, with draws more power from the device’s battery. LTPO (Low-temperature Poly-Oxide) is a combination of LTPS (Low-temperature poly-silicon) and IGZO (Indium Gallium Zinc Oxide) backplane solutions, and is able to allow high refresh rates as well as low refresh rates, which gives the device designers the ability to create a ‘variable rate’ device. Such systems can sense the resolution of an image stream and tailor the display’s refresh rate to meet that need, so the device can run high resolution images when necessary, but can also throttle the refresh rate to very low levels for text or other slow moving images, saving considerable battery resources.
Apple is credited with the development of LTPO and has used it in the Apple Watch since 2018, but it was used in Samsung (005930.KS) smartphones (Note 20 Ultra) in 2020 and a number of Chinese brands before Apple began to migrate to the technology last year. The process for producing LTPO is more complex than either of the two processes from which it is derived and that complexity gave Samsung Display the first mover advantage for LTPO, especially in 2021 when it was the sole supplier for the iPhone 13. This year however, LG Display (LPL) has been working toward adding LTPO to the displays it provides to Apple and had to go through Apple’s rigorous qualification process to join rival SDC, which took longer than expected, leaving Samsung Display as the sole OLED display supplier to the iPhone 14 Pro Max and the iPhone 14 Pro until the end of October. From that date forward LG Display can now provide LTPO displays for those models, in addition to the two LTPS models it previously supplied, which will reduce SDC’s shipment levels and give a boost to LG Display’s mobile OLED display business, which took a hit when parent LG Electronics bowed out of the mobile phone business last year, especially as the two LTPO models have proven more popular than expected.
BOE (200725.CH) remains a supplier of the iPhone 14’s two LTPS models, but has been working toward improving yields on its LTPO production, although we expect they will likely not qualify this year. That said, there is the possibility that BOE could get LTPO qualified for the iPhone 15, which would eat further into SDC’s dominant position. While this is certainly a factor, yield is still a major consideration, and SDC’s long experience as an LTPO producer will likely leave them as the highest volume supplier, but the addition of LG Display and potentially BOE will likely put pricing pressure on SDC going forward. We expect this will trickle down through the component supply chain in 2023, with purchasing leverage moving from SDC to LGD and BOE, and Apple able to make progress in lower display costs.
Apple is credited with the development of LTPO and has used it in the Apple Watch since 2018, but it was used in Samsung (005930.KS) smartphones (Note 20 Ultra) in 2020 and a number of Chinese brands before Apple began to migrate to the technology last year. The process for producing LTPO is more complex than either of the two processes from which it is derived and that complexity gave Samsung Display the first mover advantage for LTPO, especially in 2021 when it was the sole supplier for the iPhone 13. This year however, LG Display (LPL) has been working toward adding LTPO to the displays it provides to Apple and had to go through Apple’s rigorous qualification process to join rival SDC, which took longer than expected, leaving Samsung Display as the sole OLED display supplier to the iPhone 14 Pro Max and the iPhone 14 Pro until the end of October. From that date forward LG Display can now provide LTPO displays for those models, in addition to the two LTPS models it previously supplied, which will reduce SDC’s shipment levels and give a boost to LG Display’s mobile OLED display business, which took a hit when parent LG Electronics bowed out of the mobile phone business last year, especially as the two LTPO models have proven more popular than expected.
BOE (200725.CH) remains a supplier of the iPhone 14’s two LTPS models, but has been working toward improving yields on its LTPO production, although we expect they will likely not qualify this year. That said, there is the possibility that BOE could get LTPO qualified for the iPhone 15, which would eat further into SDC’s dominant position. While this is certainly a factor, yield is still a major consideration, and SDC’s long experience as an LTPO producer will likely leave them as the highest volume supplier, but the addition of LG Display and potentially BOE will likely put pricing pressure on SDC going forward. We expect this will trickle down through the component supply chain in 2023, with purchasing leverage moving from SDC to LGD and BOE, and Apple able to make progress in lower display costs.
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