Apple supplier Japan Display is in need of an infusion of funds to remain competitive, and there is hope that the government-backed fund will step in to give a “helping hand”, people familiar with the matter tell the Wall Street Journal.
The sources say Japan Display is in talks about USD$703 million in new financing from Innovation Network Corp of Japan, its largest shareholder, which controls 36% of the display manufacturer. Other banks have allegedly lined up to provide additional monetary support, according to the sources.
The manufacturer’s chief executive, Mitsuru Comma, said on Wednesday that the INCJ “is considering financial support to help us grow,” without giving away further details.
Apparently, being Apple’s supplier doesn’t necessarily mean a surge in profits: Japan Display’s finances aren’t looking good. According to the latest earnings report posted by the display maker, revenue fell 25% in the third calendar quarter. Also, Japan display posted a net loss of 4.9 billion yuan (CAD$0.97 billion), but the executives remained positive on the outlook for the rest of the fiscal year ending March 2017, due to demand for the iPhone 7.
The investment would help Japan Display to improve its LCD technology to compete with OLED displays and build its own manufacturing line for mass producing OLED display panels, which Apple is rumoured to switch to with the next-generation iPhone.