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Market Insight

[Display Dynamics] iPhone’s panel shipments expected to decline by 12% to 206 million, from 2018 to 2019

November 06, 2019

Brian Huh Brian Huh Principal Analyst, Small/Medium Displays

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Key findings

  • Panel shipments for iPhones are expected to decline by 12% to 206 million, from 2018 to 2019.
  • Both panel shipments of thin-film-transistor liquid-crystal display (TFT-LCD) and flexible AMOLED will have double-digit declines.
  • Except for LG Display, panel shipments will decline beyond double-digits from 2018 onward for all suppliers.

iPhone’s panel shipments are expected to decline to 206 million in 2019, down by 12%

Apple retains its top ranking in the smartphone market, but the sales volume of its top-rated models continues to decrease as the global smartphone market remains stagnant. In 2019, iPhone sales are expected to decline for the second consecutive year after its peak in 2017, and this will impact the total of panel demand for iPhones. As the charts below show, iPhone’s panel shipments in 2019 are expected to reach 206 million, down by 12% from last year, which is a decrease of 71 million compared with 2017.

Based on IHS Markit research, both panel shipments of TFT-LCD and flexible AMOLED in 2019 are expected to decline over double-digits from last year. Shipments of TFT-LCD are expected to decrease to 141 million from 160 million in 2018, down by 12%, and shipments for AMOLED are likely to decrease from 73 million to 65 million, a drop of 11%.

For panel suppliers, IHS Markit expects panel shipments to decline by more than double-digits from 2018 onward, except for LG Display.

  1. Since Samsung Display began to supply flexible AMOLEDs to Apple, Samsung Display remains the leading panel supplier based on its panel shipments for two consecutive years (2018-2019). However, in 2019, shipments are expected to decrease to 60 million, down by 18% from 2018. In the first half of 2019 (H1 2019), shipments fell sharply due to the lower demand for iPhone X, XS, and XS Max. From the third quarter of 2019 (Q3 2019), shipments started to increase, thanks to the new iPhone series – iPhone 11 Pro and 11 Pro Max – but the demand for the second half of 2019 (H2 2019) will not likely be as strong as last year. Furthermore, Samsung Display has experienced some difficulties of extreme low utilization rates of its A3 factory in H1 2019. The company shipped out too many panels in the second half of 2018 (H2 2018) for iPhone XS and XS Max, but as the demand from Apple sharply decreased in H1 2019, Apple's panel purchase declined significantly. This led to the company's A3 fab’s utilization to drop greatly. Thus, Samsung Display is likely to have controlled its panel shipments in H2 2018 to prevent the sharp drop in the utilization rates of A3 fab in H1 2019. Therefore, it is difficult to say that the decrease in H2 2019 is entirely due to the decreasing demand of Apple.
  2. In the case of Japan Display, its shipments in 2019 are expected to fall to 55 million from 63 million in 2018, down by 12% from last year. Recently, Japan Display's smartphone display business is facing severe challenges. The demand from Chinese smartphone OEMs weakens, and its production volume for Chinese OEMs continues to decrease. Thus, Hakusan Gen 6 LTPS TFT-LCD fab has been discontinued since June, and the company produces all LTPS TFT-LCD smartphone panels in Mobara Gen 6 fab only. In the case of Apple products, IHS Market foresees that about 30% of Japan Display’s shipment volume is expected for the existing 4.7-inch and 5.5-inch iPhone products. The remaining 70% will be for the 6.1-inch iPhone XR and iPhone 11.
  3. Sharp's panel shipments for Apple are estimated at 50 million, which dropped by 13% from 2018. Sharp produced only 4.7-inch panels for H1 2019 and plans to start the production of 6.1-inch panels from Q3 2019.
  4. Unlike other panel suppliers, LG Display's panel shipments are expected to increase to 41 million, up 4% from 2018. Although the demands for 4.7-inch and 5.5-inch panels have decreased, the 6.1-inch panels’ demand is expected to increase in H2 2019, especially when LG Display supplies the 6.5-inch flexible AMOLED for iPhone 11 Pro Max in Q3 2019, thus, this will help to increase LG Display's shipment and revenue in 2019. In terms of display technology, TFT-LCD shipments are expected to drop 9% year over year (YoY) to 39 million, and flexible AMOLED shipments are estimated to reach between 5 to 6 million in 2019. It is LG Display’s first OLED product for Apple, so AMOLED shipments will be highly impacted by the stability of yield rate and product quality.

Research by Market
Displays
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