Just a few years back, Japan Display was talking about building a $1.4 billion factory to create iPhone displays for Apple. Jump forward to 2018 and the company is having to reimagine its future for a world in which smartphone growth isn’t guaranteed.
According to a new report, Japan Display has responded by focusing on smart sensors. Compared to one year ago, the firm has shifted one-third of its research staff to sensor development. These would be focused on everything from sleep tracking to assorted healthcare applications.
Japan Display’s stock has fallen close to 80 percent this year. That’s a disastrous turn of events. Apple, by comparison, has lost around one-fifth of its value from its $1 trillion 2018 peak. Bloomberg cites “pessimism over demand for Apple’s new iPhone models” as one of the main reasons.
However, Japan Display has been struggling for quite some time, particularly as the shift to OLED displays (which it is lagging behind on) came into effect.
“Given how fierce the competition is becoming in displays, we need to find something that generates equal value, or we won’t survive,” said Chief Technology Officer Kazutaka Nagaoka in Tokyo this week.
Struggles to diversify
Japan Display is far from the only Apple supplier to be trying to enter other markets to account for a slowing down in orders. That’s not just from Apple but the overall smartphone market. Foxconn, for instance, has talked about shifting to cloud computing and even smart toilets. A number of suppliers which rely heavily on Apple (or smartphones more generally) have been hit hard by the recent market slowdown.
AAPL is currently trading at $170.95. That’s not quite its highest point all week (it has hit $171 a few times), but it’s higher than the $165 it started the week at. Nonetheless, these prices are considerably lower than the $232.07 it reached in early October.