Apple display supplier Sharp posts $1.9 billion annual loss, avoids collapse

Sharp blamed the loss on competition from cheaper Chinese smartphone LCD panels, as well as past restructuring charges, according to the Financial Times. The company has in fact announced a new set of restructuring efforts, including laying off 10 percent of its workers, among them 3,500 people in Japan. It will also be selling off its head office in western Japan.

Mizuho and Bank of Tokyo-Mitsubishi UFJ have agreed to give Sharp 200 billion yen (approximately $1.7 billion) in a debt-for-equity swap, and the company will get an additional 25 billion yen ($209.9 million) from a fund backed by the banks. In its next fiscal year, the company is hoping to post an operating profit of 80 billion yen ($671.8 million). It could return to a net profit in fiscal 2017.

While Apple also sources displays from LG and Samsung, Sharp is a major partner, and is credited with being the first company to build LCD panels using IGZO (indium gallium zinc oxide) technology back in 2012. Apple may be preparing to switch to IGZO for its upcoming 12.9-inch iPad, though panels would allegedly be produced by LG and Samsung as well.

IGZO could potentially improve the response, thinness, and power consumption of Apple displays. At the moment the company relies on LTPS (low-temperature polycrystaline silicon) panels for iPhones and iPads.