Apple to completely abandon the use of LCD screens: From 2025, all iPhones will have OLED displays

Apple will exclusively use OLED (organic light-emitting diode) displays in all iPhone models starting next year, including its lower-priced iPhone SE series, shifting away from liquid crystal displays (LCDs). This transition means that Japan Display Inc. (JDI) and Sharp, two major Japanese panel suppliers, will no longer be part of Apple's supply chain for iPhone screens.

A Major Shift in Display Technology

Accroding to Nikkei.com, until now, JDI and Sharp have been supplying LCD panels primarily for the iPhone SE. About a decade ago, these companies held a combined share of 70% in iPhone displays. However, as Apple started using OLED technology for its premium models, their share gradually diminished. South Korean and Chinese manufacturers, like Samsung Electronics and BOE Technology Group, have since taken the lead in OLED production.

Apple has reportedly begun placing orders for OLED displays for its next-generation iPhone SE from BOE Technology Group in China and LG Display in South Korea. The iPhone SE, slated for release next year, will feature OLED screens, marking the end of LCDs in all iPhone models, from entry-level to premium. Currently, Samsung holds about 50% of the OLED display market for iPhones, LG Display approximately 30%, and BOE around 20%. Neither JDI nor Sharp has a substantial presence in OLED smartphone displays, effectively ending their supply of screens for iPhones with the discontinuation of older SE models.

The Rise of OLED: Why Apple is Making the Switch

OLED displays are made from organic compounds in red, green, and blue that emit light without a backlight, providing more vivid colors and sharper contrast than LCDs. This technology also allows for thinner and lighter screens, which are particularly advantageous for mobile devices where screen quality is a critical factor. With the growing demand for high-quality visuals for activities such as watching movies, gaming, and sports, OLED screens have become the preferred choice for smartphones.

Samsung was a pioneer in using OLED displays, launching them in smartphones in 2009. Apple followed suit in 2017 with the iPhone X, the first iPhone model to feature an OLED screen. Since then, Apple has gradually transitioned its premium models from LCDs to OLEDs.

Impact on Japanese Manufacturers

The move away from LCD screens represents a significant blow to Japanese display makers. A decade ago, JDI and Sharp were supplying nearly 200 million LCDs annually for iPhones, but this number fell to around 20 million by 2023. According to U.K.-based market researcher Omdia, OLED panels are expected to surpass LCDs in the number of smartphone panels shipped globally this year.

As a result, JDI and Sharp face an uncertain future in the smartphone market. JDI, which once depended on Apple for 60% of its revenue, has recorded net losses for ten consecutive years due to the transition to OLED technology. The company is currently focusing on developing energy-efficient OLEDs for smaller devices, like the Apple Watch, and revamping its business strategy around LCDs for automotive applications. Meanwhile, Sharp is scaling back its LCD operations, having recently shut down its Sakai plant in Osaka and reduced capacity at its Kameyama plant in Mie Prefecture.