Ming-Chi Kuo Reiterates 3 iPhone Introduction in 2018
July 02, 2018
Ming-Chi Kuo continues to believe that the 6.1-inch iPhone will feature an LCD display but with the all-screen style introduced with the iPhone X. Because of this design decision, Kuo reports the LCD production is more difficult and will kick off later in the year, but the analyst expects models to be ready in time for release in September. Last year’s iPhone 8 and iPhone 8 Plus shipped in September, and the OLED iPhone X debuted in November. Kuo predicts the new LCD iPhone with an all-screen design will retail for $600-$700, which delivers the $1000 iPhone X design at the current price of the iPhone 8. Kuo previously predicteda $700-$800 starting price. The price difference is due to a cheaper LCD display panel vs. the superior flexible OLED panels, dropping pressure sensitive 3D Touch features, and having a single rear camera. Kuo predicts Apple will continue ordering LCD iPhones alongside OLED iPhones next year, suggesting upgraded versions of this fall’s hardware in 2019. Current rumors suggest an upgraded 5.8-inch iPhone X and a new Plus-sized 6.5-inch versionof the iPhone X will also debut this year.
The analyst note also touches on other issues including potential risks of a trade warbetween the US and China. Kuo writes that it is difficult to predict what could happen, but Apple likely won’t be directly affected. Instead, Apple’s brand runs the risk of being hurt in China over anti-US sentiment and not a direct policy change.
SCMR predicts the iPhone shipments in terms of the existing iPhone X (5.8”), the replacement iPhone X’ (5.8”) and the iPhone X Plus (6.5”). It is expected that
Table 1: 2018 iPhone Shipments
Source: SCMR LLC
Converting panels to sq. m and calculating the amount of capacity used by Apple’s flexible iPhone displays, the utilization of Samsung’s A3 Fab capacity is shown in the next table. The table indicates that while each iPhone model has a relatively modest impact on total capacity on a yearly basis (no greater than 15% individually), the 2ndhalf of the year, particularly the last four months, the impact is significant, with the iPhone 9 peaking in November at 39%, the highest percent of capacity, other than the January run-off for the iPhone X, which declines from that point.
Table 2: iPhone as a Percentage of Samsung Display Available Flexible Small Panel Capacity – 2018
Source: SCMR LLC
The table indicates that while each iPhone model has a relatively modest impact on total capacity on a yearly basis (no greater than 15% individually), the 2ndhalf of the year, particularly the last four months, the impact is significant, with the iPhone 9 peaking in November at 39%, the highest percent of capacity, other than the January run-off for the iPhone X, which declines from that point.
Samsung Display’s other customers including Samsung Electronics were left out of the calculations. Samsung Electronics are expected to sell 70m-80m flexible OLED units in 2018, giving it a 34.0% to 40% share of SDCs small panel available flexible OLED capacity, only 3.2% less than Apple’s, considering all three iPhone devices.
Considering that in 2017 Apple purchased 80-100m 5.8” flexible panels for the iPhone X, they did not need any more to complete their 2018 build. Therefore we reduced the iPhone X’ panel purchases to a minimal amount. In addition we have accounted for flexible panel shipments to the Chinese and other OEMs. The results are shown in the next figure.
Figure 1: Customer Utilization Rate - Samsung Display Available Small Panel Flexible OLED Capacity
Source: OLED-A, SCMR LL