Samsung AMOLED Supply Issues Could Limit OPPO’s Sales

OPPO has stated that it wishes to sell between 90 to 100 million devices in 2016 but now it appears that the company could fall short because of an AMOLED display shortage. Originally, OPPO had set a target of 60 million devices in 2016 but revised this upwards to 80 million back in June. More recently, it (internally) increased this to the current target - almost double the 50 million smartphones the Chinese company sold in 2015. However, unnamed industry sources believe that Samsung Display is going to struggle to keep up with demand. Samsung is expected to ship 100 million AMOLED panels in total to Chinese manufacturers, with a further 240 million used by Samsung's own smartphones. Samsung is boosting production of its AMOLED factory lines to increase supply for the Chinese market, which is expected to exceed 150 million by 2019 but this is of course three years from now. Samsung will also increase the supply of AMOLED panels to its own smartphone business to almost 300 million over the same period.

There are persistent rumors that Samsung is set to provide Apple with AMOLED panels for a future iPhone model and presumably the South Korean company has been and will continue to prepare factory lines for the Apple product. It takes a number of months before AMOLED production lines are running at full capacity. While it is not certain that Apple are to become a Samsung Display AMOLED customer, if they are, they will likely have an exclusive production line or even a factory. Samsung is also unlikely to cannibalize its own internal customer for the Chinese manufacturers.

It is possible that Samsung Display has been caught out by the rapid increase in demand for AMOLED technology, especially from the Chinese companies although AMOLED has been moving towards being a more preferred display technology for some time now. Samsung Display is of course set to benefit from the shortage of panels as this means it can charge more, but other panel makers such as LG are working on bringing their own OLED factories up to full production, which could increase choice for smartphone manufacturers. Meanwhile, some companies, such as Xiaomi, are using alternative panel providers and technologies (LCD) for new models. Samsung may need to carefully manage its supply of AMOLED and how quickly it brings production lines up to full capacity.

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David Steele

Senior Staff Writer
I grew up with 8-bit computers and moved into PDAs in my professional life, using a number of devices from early Windows CE clamshells and later. Today, my main devices are a Nexus 5X, a Sony Xperia Z Tablet and a coffee cup.
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