Sharp Is Behind on Producing iPhone Screens

It could affect Apple's ability to meet demand for the new iPhone

   

Apple (NASDAQ:AAPL) may be facing a problem with the launch of the next generation iPhone, widely expected to debut next month.

Sources tell the Wall Street Journal that Sharp (PINK:SHCAY), one of the three major suppliers of the LCD touchscreen panels used in iPhones, has missed its originally planned shipping dates.

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The touchscreens from Sharp were supposed to ship in late August, but the company is experiencing trouble at its production facilities. The new iPhone is rumored to include slimmer in-cell technology LCD screens, which are more challenging to produce.

Shares of Sharp tumbled more than 10% in over-the-counter trading in New York on Friday.

LG Displays (NYSE:LPL) and Japan Display have successfully started mass production of the LCD displays and are making deliveries to Apple’s manufacturing partners.

The sources said that Sharp was unable to determine when it could start shipping LCD displays for the iPhone.

This marks the second time Sharp has encountered problems meeting its LCD orders for Apple. Shipments of LCD screens for the iPad were postponed earlier this year, though the disruption did not lead to any supply problems with the device. Apple sold 17 million iPads during the second quarter.

In addition to the production problems, Sharp is also facing financial pressure. It posted a $3.18 billion loss in fiscal 2012 and has $15 billion in debt.

Apple is expected to unveil the new iPhone at a media event on September 12. With demand anticipated to be strong, the last thing Apple needs is a component shortage to frustrate customers and delay sales.


Article printed from InvestorPlace Media, http://investorplace.com/2012/08/sharp-is-behind-on-producing-iphone-screens/.

©2014 InvestorPlace Media, LLC

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