Following Universal Display's (NASDAQ:OLED) "mixed Q3 results," fellow Fool Steve Symington wrote an excellent piece defending the company's long-term story. While Universal did drop its full-year revenue guidance range of $190 million to $205 million to between $183 million and $185 million, Symington did highlight the fact that smartphones and wearables are increasingly adopting OLED technology. 

A review of Apple's (NASDAQ:AAPL) recent job listings suggests Universal Display's long-term future might include spots inside Apple's iDevices.

Apple is hiring: "OLED process experience is preferred"
On Nov. 4, Apple posted a job listing for a "Display Technical Process Manager." This person will be "responsible for the development and implementation of cutting edge production technology, high volume manufacturing processes for displays."

The fact that Apple is hiring for this position isn't particularly noteworthy. What did stand out, though, is that among the "key qualifications" listed for this position, Apple explicitly stated: "OLED process experience is preferred" [emphasis mine].

Could this mean that Apple is looking to more broadly adopt OLED displays?

Apple Watch already uses OLED; could iPhone be next?
According to OLED-Info.com, the upcoming Apple Watch will include an OLED. According to Craig Freudenrich from HowStuffWorks, OLED displays offer a number of advantages. They:

  • Don't require backlighting, which means lower power consumption than LCDs;
  • Offer larger fields of view;
  • Are thinner and lighter than LCDs; and
  • Are brighter than LEDs.

Freudenrich pointed out, though, that OLEDs do have their fair share of problems, namely:

  • Blue OLED films apparently offer very short lifetimes relative to the red and green OLED films;
  • The "manufacturing processes" for creating OLEDs are costly; and
  • OLEDs are apparently quite vulnerable to water.

At any rate, it seems OLED technology offers some compelling advantages over the LCDs that Apple uses today. Indeed, DisplayMate said while the iPhone 6 Plus has the best mobile LCD that it has tested yet, it still gave the "best mobile display" title to the OLED found on the Samsung Galaxy Note 4.

Why does it make sense on Apple Watch, but not iPhone, today?
Assuming the report that the Apple Watch will employ OLEDs is correct, the question becomes why this technology would make sense for that device but not some of other Apple's product lines. My guess is that it all comes down to margins.

The Apple Watch features a relatively small display, and the cheapest of the watches will, according to Apple, retail at $349. MacRumors cited a report from iGen.fr claiming that the stainless steel variant of Apple Watch will begin at $500 and that the gold variant will sell for between $4,000 and $5,000.

I'd imagine that at these prices, the gross margin percentage per unit compared to an iPhone will be quite high, so using a relatively small OLED probably isn't going to have a big financial impact on Apple's business. Sticking a display that is significantly more expensive to produce onto Apple's bread-and-butter iPhone, on the other hand, could meaningfully hurt profits.

Apple still wants the best
However, Apple does tend to care a lot about the quality of the displays found on its devices. In fact, CNET quoted CEO Tim Cook as saying "We want the best display, and I think we've got it."

Today LCDs seem to be doing the job well -- the iPhone 6 and iPhone 6 Plus displays have been widely praised -- but if Apple eventually needs to move to OLEDs to have the "best display," then I think the company will work closely with suppliers to try to make deploying OLEDs as cost effective as possible. 

Ashraf Eassa has no position in any stocks mentioned. The Motley Fool recommends Apple and Universal Display. The Motley Fool owns shares of Apple and Universal Display. Try any of our Foolish newsletter services free for 30 days. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy.