When it comes to companies like Apple, the number of vendors that such companies contract is huge, and many of those vendors eventually come to depend on the business that they generate from those companies. It is the same for many vendors and their relationship with, particularly large companies. It is perhaps a bit more pronounced when the product that is being produced is a consumer product, and in this regard, Apple is in a league of its own. In a new development, the company decided to invest $100 million in the Japanese company Japan Display, according to reports in the local media.
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Japan Display used to manufacture the liquid crystal displays that were used in the company’s flagship product, the iPhone. As the years went by and the sales of iPhone soared, the relationship became even more lucrative as Japan Display continued to get lots of orders. Eventually, the income from Apple came to constitute as much as 60% of the company’s revenues and needless to say, that is not a particularly good thing for any company.
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However, that all changed last year and changed pretty quickly, primarily due to two reasons. One of the biggest blows for the company lay in the fact that Apple decided to do away with liquid crystal displays for its iPhone and that completely obliterated Japan Display’s hopes of continuing to generate healthy revenues through this partnership. In addition to that, the poor sales of the iPhone XR also proved to be a problem for the company in general. In a nutshell, the company was clearly on its last legs and had even been courted by a consortium of investors based out of China. However, help finally came to the company by way of their biggest client, Apple, who decided to invest $100 million in the company and it seems that it will prove to be just the lifeline that the company needs. In this regard, it is important to note that Japan Display has not made any comment regarding the investment, and no official announcement has been done.
