What: Shares of Universal Display Corporation (NASDAQ:OLED) rose as much as 11.4% Thursday -- and were up just over 10% at 3:45 p.m. -- after the OLED technologist's CFO, Sidney Rosenblatt, spoke of OLED's prospects regarding a certain Cupertino-based business at the Goldman Sachs U.S. Emerging/SMID Cap Growth Conference.
So what: Rosenblatt primarily elaborated on much of what investors already knew following Universal Display's impressive third-quarter report two weeks ago. But arguably the primary driver of today's pop were his specific comments on Apple's (NASDAQ:AAPL) plans for OLED going forward.
First, without specifically mentioning Apple, early in the call Rosenblatt noted several reports that longtime Apple supplier Foxconn (NASDAQOTH: FXCNY) "has ordered equipment for [OLED manufacturing] capacity in 2017." For perspective, the first of those reports heated up the Apple-OLED rumor mill almost exactly one year ago, when Japanese media outlets suggested Foxconn and Innolux were tasked by Apple to invest $2.6 billion in a new display factory targeting "2016 or 2017" production of OLED displays for both wearables and smartphones.
But things got more interesting when Goldman analyst Brian Lee prompted Rosenblatt to comment specifically on Apple's plans to expand its use of OLED technology from "just" the Apple Watch going forward.
We do know that Apple has been working on OLEDs. They've been filing OLED patents for six or seven years -- mostly design patents. There are lots of reports that they're going to be used for a next-generation iPhone. Realistically, based upon the number of phones that they sell, capacity won't be in the marketplace until 2017 if they decide to do it.
Rosenblatt went on:
I think that in the New Yorker article about Apple in February of this year, where Jony Ives, their chief technology officer, talked about Apple for multiple pages, there is a section in there where he talks about his screen on his iPhone 6 -- which hadn't even come out -- is old technology. It looks old. And [he] talks about a new technology they're going to use for their watches that only puts current to the pixels that light up, gives you a true black background, and gives you a much thinner form factor, and a much more power-efficient device. He talks about it being magic. Essentially, it's an OLED. So I think that it's only a matter of time.
Now what: At the same time, Rosenblatt offered the caveat that "Clearly we can't speak for Apple." And keep in mind Rosenblatt didn't directly confirm Apple's plans to use OLED in its iPhone lineup. But it's rare to hear Universal Display management take such a confident stance -- if they mention it at all -- on the topic of Apple's unreleased products.
Meanwhile, it also helps that today, the U.S. Patent and Trademark Office published a new patent application from Apple related to an integrated Silicon-OLED display with an integrated touch panel. According to PatentlyApple, the application suggests the use of OLED will allow for "an extremely high number of pixels per inch," and "a wider viewing angle display with a higher contrast ratio, higher brightness, and more vibrant colors without compromising touch sensitivity."
Of course, it could be a coincidence that the verbiage used in Apple's newest OLED iPhone patent so closely mirrors what Rosenblatt suggests Apple loves about the technology. But in the end, given this reminder and strong hint of Apple's expanded OLED adoption, it's no surprise Universal Display shares are climbing today.