Samsung’s OLED displays are used on its own flagship Galaxy devices and the company is a market-leader in the area. Apple is expected to launch three new iPhones later this year, with the anniversary edition iPhone 8 believed to have a slightly curved 5.2-inch OLED screen. This will be the most expensive model. The other two iPhones will have LCD displays.
It would be the first time Apple has used OLED displays on its flagship device.
Samsung has not responded to a request for comment when contacted by CNBC. Apple declined to comment.
Nikkei Asian Review quoted IHS Markit analyst David Hsieh as saying that the order for 70 million units of OLED panels is in line with his expectations, adding that Samsung is expecting to produce as many as 95 million units for Apple in 2017, in case demand exceeds expectations. Hsieh said that Samsung is likely to be the sole supplier.
“It is also possible that some of these 70 million handsets will not be shipped to customers this year and be carried over to next year depending on demand,” Hsieh told the Nikkei.
The 70 million unit figure gives a sense of the kind of bullish demand Apple is expecting for the anniversary model which some analysts are suggesting could cost somewhere in the region of $900 to $1,000.
But some analysts have said that it’s not likely Apple will sell all 70 million OLED iPhones this year looking at previous performance. In Apple’s fiscal first quarter, which was the three months to December 31, 2016, 78.2 million iPhone units were sold. But these were not solely made up of the latest iPhone 7 and 7 Plus models, and included older versions of the device too.
Neil Shah, research director of devices and ecosystems at Counterpoint Research, said he expects Apple to be able to sell around 70 million iPhones in total in the final quarter of this year when it releases the new device. But again, not all 70 million will be the OLED devices.
“Seventy million units of the OLED iPhone is too high for me at this point,” Shah told CNBC.
The likelihood is Apple will sell some of the OLED phones next year, and at least have some ready in case it sees a pop in demand.
Leaks and reports suggest that the iPhone 8 could be the most advanced yet with new features such as a front-facing camera with 3-D sensor. Analysts are expecting this to kick of a “supercycle” of iPhone sales. For example, JPMorgan raised its price target for Apple’s stock based on a more optimistic outlook on iPhone sales.
“When you look at the iPhone cycle, we don’t think people have factored in just how strong of an iPhone cycle this is going to be,” JPMorgan analyst Rod Hall told CNBC in a TV interview last month.