## Apple’s Potential Future Supplier Faces Setback
Apple, the tech giant known for its innovative and cutting-edge products, is believed to be the unnamed customer who cancelled orders for micro LED displays. The cancellation has caused a significant 40% drop in shares for ams Osram, the Austrian firm presumed to be the supplier. The displays were thought to be for the upcoming Apple Watch Ultra.
Ams Osram and Apple’s Unconfirmed Relationship
While neither of the companies have officially confirmed their partnership, industry insiders have often linked ams Osram to Apple. In 2023, ams Osram forecasted an increase in revenues by 2025, coinciding with the expected launch of the Apple Watch Ultra 3 featuring micro LED technology.
Impact of Order Cancellation on Ams Osram
Whether Apple was indeed the client or not, ams Osram is facing significant repercussions following the sudden cancellation of a substantial order. The company had invested heavily in this project, even constructing a purpose-built $1.41 billion factory in Malaysia.
“We thought everything was on track,” CFO Rainer Irle shared in a conference call. The company is now considering selling this new factory following this setback.
Financial Implications for Ams Osram
In its announcement regarding the project cancellation, ams Osram revealed that it expects to record non-cash impairment charges on microLED related assets and goodwill of $650 million to $970 million in the first quarter of fiscal year 2024. The company’s shares have plummeted by 40% following the news.
Future of Micro LED Technology and Apple Watch Ultra
If Apple was indeed the customer for the micro LED displays, it is speculated that the order cancellation could be linked to repeated delays in the launch of the new Apple Watch Ultra. Some reports suggest that the new watch might be pushed back to 2027.
However, it’s worth noting that LG has reportedly been buying patents to expedite its own development of micro LED screens. Additionally, there have been claims that Apple has been struggling to finalize the component supply chain.
Conclusion
The cancellation of the large order for micro LED displays has led to significant financial implications for ams Osram. While discussions with the customer are ongoing, the future of the Apple Watch Ultra and the use of micro LED technology remains uncertain.
Questions & Answers
Q: Who is believed to have cancelled the large order for micro LED displays?
A: Apple is believed to be the customer who cancelled the order.
Q: What impact did the cancellation have on ams Osram?
A: The cancellation led to a 40% drop in ams Osram’s shares and potential non-cash impairment charges of $650 million to $970 million.
Q: What is the connection between ams Osram and Apple?
A: While it’s not officially confirmed, ams Osram is often linked to Apple as a potential supplier of micro LED displays for the next Apple Watch Ultra.
Q: What effect might this cancellation have on the release of the new Apple Watch Ultra?
A: If Apple was indeed the customer, the cancellation could be linked to further delays in the launch of the new Apple Watch Ultra.
Q: What steps has LG taken in relation to micro LED technology?
A: Reports suggest that LG has been buying patents specifically to speed up its own development of micro LED screens.
