Despite the competitive nature between Apple and Samsung, the two companies are business partners, indeed. Samsung invests heavily in their premium Galaxy Series to prove better than the iPhone, but deep down, Apple contracts are lucrative for them.
Generally, the premium smartphone market has experienced a decline in demand, with Apple being the most affected tech company. Apple experienced a revenue decline of 17% in Q1 2019 compared to a similar period last year, as a result, Samsung Display seeks compensation for millions of dollars.
Apple CEO, Tim Cook, stated the sluggish iPhone shipments is attributed to the clingy nature of some Apple customers for repairing the devices rather than buying new ones plus ‘softness’ in the Chinese market.
The South Korean news site ETNews reported Apple signed a contract to secure a certain level of supply with Samsung Display to secure OLED panels for iPhones which they haven’t met.
It is reported that Samsung Display had to invest in a new company to increase the production of OLED panels to meet Apple’s demand – about 100million units a year. However, due to the slump in iPhone sales, Samsung Display has suffered severe losses as a result. Samsung Display recorded a profit decline from 5.7 trillion won in 2017 to 2.62 trillion won in 2018.
The cash might be hard to pay, but ETNews reported the company(Apple) seeks to counter the problem by considering using the panels in other devices like the tablets and notebooks.