Apple Inc.(NASDAQ:AAPL) is designing and producing its own device displays for the first time, according to Bloomberg, and word of the tech giant's efforts to make the screens is dinging the stocks of display technology suppliers such as Universal Display Corp. (NASDAQ:OLED).
Universal Display shares were down around 7.2% in premarket trading, at US$115 a share, in light of a Bloomberg report that Apple is using a secret manufacturing operation near its Cupertino, California, headquarters to make small numbers of the screens for testing purposes. Bloomberg cites people familiar with the situation as the source of its information.
According to Bloomberg, Apple is making a big investment in the development of next-generation MicroLED screens, which use different light-emitting compounds than current OLED displays. The goal is to produce gadgets that are slimmer, brighter and don't consume as much power.
No easy task
Bloomberg said the screens are far more difficult to produce than OLED displays and that Apple almost killed the project a year or so ago. Engineers since then have made progress, according to Bloomberg, though consumers likely will need to wait a few years before seeing the results of Apple's efforts.
The prospect of Apple producing yet another key component of its products in-house was hurting the shares of display technology suppliers such as Universal Display in the U.S. and Sharp Corp. and LG Display Co. overseas.
Bloomberg said the secret initiative is overseen by Lynn Youngs, an Apple veteran who helped develop touch screens for the original iPhone and iPad and now oversees iPhone and Apple Watch screen technology.
According to Bloomberg, about 300 engineers are designing and producing MicroLED screens for use in future products.
Bloomberg said an Apple spokeswoman declined to comment on its report.