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Apple might owe Samsung big after failing to sell enough iPhones

It didn't buy enough OLED screens from Samsung Display, according to ETNews.

Disappointed iPhone XS sales may have hurt Apple's relationship with its display supplier.
Angela Lang/CNET

Apple could owe Samsung Display "hundreds of billions of won" in penalties for not buying enough OLED screens -- found in iPhone XS, XS Max and X -- due to lackluster iPhone sales, according to Korean outlet ETNews. That'd be about $90 million in fines, which isn't much to Apple, but could strain on its relationship with the supplier.

The Cupertino, California giant insisted that Samsung Display build a factory for the exclusive purpose of making OLED screens, saying it'd need 100 million iPhone displays a year, our sister site ZDNet noted. The weak sales hit Samsung Display hard -- causing operating profits to fall from 5.7 trillion won (around $4.9 billion) in 2017 to 2.62 trillion won (about $2.2 billion) in 2018.

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It's unlikely that Apple will pay a cash penalty, but offer Samsung Display fresh contracts for OLED screens in tablets and notebooks, according to ETNews. 

Apple is also rumored to be moving to an all OLED line-up for 2020, after last year's budget iPhone XR stuck with the old LCD display.

Samsung declined to comment on the story, while Apple didn't immediately respond to a request for comment.

First published at 3:23 a.m. PT.
Updated at 9:12 a.m. PT: Adds that Samsung declined comment.