Apple May Have Just Cancelled the MicroLED Apple Watch

Apple supplier ams-OSRAM just announced the unexpected cancellation of a cornerstone microLED project, tanking its stock by 45%. It's widely believed this project was to make microLED display panels for an upcoming Apple Watch model.

In a statement today, ams-OSRAM said...

The Management Board of ams OSRAM AG has decided to re-assess the microLED strategy of the company after having been informed of the unexpected cancellation of a cornerstone project for its microLED program. Discussions with the related customer are ongoing.


In an emergency conference call, CEO Aldo Kamper described the company's shock at the abrupt cancellation.

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"You are as surprised as we probably were yesterday by the reason for this call. We were informed that the cornerstone program that we've been working on for a number of years now has been cancelled on the micro-LED side. And that of course caught us by surprise and also caught us off balance, if you will."

"We have been making, I think, very solid progress over the last years on the technology. And therefore, we're clearly expecting this program to continue and to become a launchable product in the near future, as we have also discussed with you. But the customer has decided otherwise, as we were informed."

"The shock is still there, I must say. We just came out of our internal communication with our employees and our teams. And they have been working extremely hard on this, both on the technology and R&D side, where we have solved over time many very difficult riddles. Riddles important for this technology to be resolved. We continue to think that we have a very strong technology base here. And also on the operations side, where the Kulim factory was built in record time and is also operational and starts to also contribute to the development effort."


"So the teams are, of course, also very disappointed and are wondering about the next steps, like you are. And honestly speaking, we are in the process of sorting that out ourselves. It is still an application space and a technology space that is exciting, that has appeal for us. At the same time, now with the cornerstone program being canceled, it does make the introduction at least in this time frame much more difficult, given that it is important that you have a lead program to start with, to really bring this technology to life. Because it is not only our piece of technology that needs to come alive. You also know there are a number of other steps in this chain as well that need to come alive to make it feasible to really process these ultra small structures into exciting display technology."
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Following the cancellation of the cornerstone microLED project, the company will revisit the future use of its assets related to its microLED strategy, particularly the new 8-inch LED facility in Kulim (Malaysia). Based on a first, preliminary estimation, ams OSRAM expects to record non-cash impairment charges on microLED related assets and goodwill of EUR 600 to 900 million in the first quarter of fiscal year 2024.

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