Samsung Display faces supply constraints on soaring OLED demand

[THE INVESTOR] Samsung Display, the display-making unit of Samsung Electronics, is facing supply constraints amid soaring Chinese demand for its organic light-emitting diode panels.

According to Taiwan-based Digi Times, China's budget smartphone maker Oppo may fall short of its revised goal of shipping 90 to 100 million smartphones this year due to insufficient supply of OLED panels from Samsung.

Oppo R9 smartphone that uses Samsung Display's OLED display screen

The newspaper added Oppo has already asked Samsung to increase its panel supplies but the display maker is having trouble in meeting the demand.

Samsung has planned to ship a total of 100 million smartphone-use panels to China-based smartphone makers, including Oppo and other vendors, in addition to 240 million units used for its own Galaxy phones.

Oppo and Vivo, both specializing in budget phones, have been increasingly adopting OLED screens to their flagship smartphones with aims to differentiate from their bigger rivals such as Huawei and Xiaomi. Their OLED adoption stood at 37 percent for Oppo and 25 percent for Vivo, outpacing 8 percent of Huawei.

Samsung is injecting 10 trillion won (US$8.95 billion) to 15 trillion won into beefing up OLED production in Korea. The production capacity at its A3 plant in Asan, South Chungcheong Province, is expected to increase from the current 15,000 panels per month to some 150,000 units next year, most of them being suppli ed to Apple's iPhone.

LG Display, which has focused more on larger OLED panels for TVs, has also announced plans to inject 1.99 trillion won for monthly production of 15,000 mobile-use OLED panels at its P9 plant in Paju, Gyeonggi Province.

By Lee Ji-yoon (jylee@heraldcorp.com)

Source: Samsung Display faces supply constraints on soaring OLED demand

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