LG Display Co. (034220), a supplier to Apple Inc. (AAPL:US), started mass production this month of screens with built- in touch sensors, components speculated to be used in the next version of the iPhone.
“There were a lot of trials and errors as we tried a technology that hadn’t been used,” LG Display Chief Executive Officer Han Sang Beom said yesterday in response to a reporter’s question, without identifying the customer. “We’re all cleared now.” Steve Park, a Seoul-based spokesman for Apple, declined to comment on plans for the next iPhone.
The screens’ so-called in-cell technology embeds touch sensors directly into displays instead of adding them separately, allowing devices to be thinner. The new iPhone, expected to be introduced next month, will probably be the first to use this approach, said Hwang Joon Ho, a Seoul-based analyst at Daewoo Securities Co.
LG’s production of the screens is “largely in line with the release schedule of the new iPhone,” Hwang said today.
The new iPhone will have a larger screen and thinner body, according to analysts such as Piper Jaffray Cos.’ Gene Munster. Cupertino, California-based Apple is preparing to introduce the device on Sept. 12 in what will be a design overhaul of its top- selling product, two people with knowledge of the company’s plans said in July.
LG Display rose 0.2 percent to 27,000 won as of 11:23 a.m. in Seoul, while South Korea’s benchmark Kospi index climbed 0.1 percent. The stock has advanced 10 percent this year, compared with a 6.1 percent gain for the Kospi.
Apple acquired a patent related to incorporating touch capabilities into displays this month, according to the U.S. Patent and Trademark Office.
Producing displays with built-in touch sensors is more difficult than using the current technology, which may result in a higher rate of defects and eat into LG Display’s profitability, Hwang said.
A shortage of such displays may limit availability of the new iPhone in September, Ben Reitzes, a New York-based analyst at Barclays Plc, wrote in an Aug. 13 report.
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