LG Display said to lessen reliance on Apple for 2013
Increased competition, as well as concerns that others may be gaining on Apple, will lead component supplier LG Display to court other clients in order to buttress its bottom line against any potential downturn in Apple's fortunes.
The South Korean conglomerate's display segment will look to market its differentiated products âincluding IPS panels, FPR-type 3D TV panels, and WRGB OLED panels â to electronics clients outside of Apple, according to BrightWire, which cited News Tomato on the report.
LG is said to face increased competition for sourcing for Apple displays.
Investor worries on the long-term viability of Apple's growth and margins is reportedly behind the display maker's decision to further diversify its clientele. The company may, though, also be looking to gain some leverage against Apple, which factors hugely into LGD's revenues and profits.
Also a concern is increasing competition from Japanese companies Sharp and Japan Display. The Wall Street Journal noted that the recently weakened Japanese yen could help those companies become more attractive to Apple for display sourcing.
LG is among the world's largest manufacturers of displays for mobile devices, second only to Samsung among flat-panel makers by revenue. Apple tapped the company, along with AU Optronics, to supply displays for last year's iPad mini, and a report in October claimed that Apple was relying heavily on LG to supply screens for its iPad mini, fourth-generation iPad, 13-inch Retina MacBook Pro, and redesigned iMacs.
LG has benefited from the partnership, as panels for tablets and smartphones accounted for about 31 percent of LG Display's sales in the fourth quarter of 2012. Analysts estimate that sales to Apple made up more than a quarter of LGD's 2012 revenue, and possibly as much as 70 percent of its profits.
For the most recent quarter, LG Display reported net profits of 319 billion won ($298 million). LCD panels for TVs were the biggest portion of LGD's fourth quarter revenue at 43 percent, while tablet and mobile device panels accounted for 17 and 14 percent, respectively.