In his latest investor’s note, Apple analyst Ming-Chi Kuo claims that Apple will be accelerating its adoption of mini-LED technology thanks to increased competition among suppliers for mini-LED chips.
It was previously believed that Epistar was going to be an exclusive supplier for mini-LED chips to Apple in 2021, but with Sanan Optoelectronics’ pace of development being better than expected, it will now also supply Apple with mini-LED chips next year instead of in 2022. Thanks to the increased competition, Apple will see its cost for mini-LED display chips go down from $75-85 to around $45. It will also lead to an increase in supply which will help Apple aggressively switch to mini-LED panels. For 2021, Kuo is expecting 30-40 percent of the total iPads to ship with a mini-LED display and 20-30 percent of the total MacBook shipments.
Although Epistar has met Apple’s mass production requirements, we believe that Apple continues to look for new suppliers in order to reduce supply risks and costs. Among the second supplier candidates, Sanan Optoelectronics’ development schedule and cost are superior to competitors (including Osram and Seoul Semiconductor). We predict that Sanan Optoelectronics will have 20–30% and 45–55% of Apple’s mini LED market share in 2021 and 2022, respectively (vs. our previous estimates of 0% and 10–20%), plus non-Apple. The demand for mini LEDs in China has grown, so we believe that Sanan Optoelectronics will significantly benefit from the mini LED business in the next 3-5 years.
Apple has long been rumored to be working on mini-LED panels for its upcoming iPad Pro and MacBook lineups. Despite multiple delays, Apple is expected to launch the first mini-LED displays based iPad Pro and MacBooks in 2021. Compared to regular LCD panels, mini-LED will offer higher brightness levels, better and richer colors, contrast, deeper black, and more.
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