iPhone X sales start to affect Korean suppliers

Sluggish iPhone X sales rumors are adversely affecting earnings forecasts for Korean electronic parts suppliers, market watchers said Sunday.

Local stock market and industry watchers said earnings estimates for chipmakers SK Hynix and Samsung Display, as well as LG Display and LG Innotek, have been downgraded for this year. They said the concerns come as sales figures for the latest iteration of Apple’s flagship smartphone may not be meeting initial expectations.

The iPhone X was expected to sell well globally, with some even worrying that demand would outpace supply, but Apple’s “battery-gate” scandal, the model’s steep price tag and weak sales in the Chinese market have all contributed to a reassessment of sales figures.

Kim Kyung-min, an analyst at Daishin Securities, said that “weak demand” for the iPhone X will invariably affect earnings of big companies in semiconductors and displays.

Reflecting this, SK Hynix and Samsung Display lowered their operating profit forecasts for 2018 to 16.07 trillion won ($15.6 billion) and 5.31 trillion won, respectively, from 16.19 trillion won and 8.29 trillion won.

LG Display, which is presumed to be preparing to supply organic light-emitting diode (OLED) panels to Apple, could be affected going forward, another source said, adding that sales estimates for LG Innotek, a local components engineering service company, could take a hit.

Some industry insiders cautioned that it is too early to worry.

“There are just too many variables related to the sales of the iPhone X so it is best to reserve judgment,” said Park Won-jae, a researcher from Mirae Asset Daewoo. YONHAP