The reason is Apple's decision to reduce production of its iPhone X model. A new report coming out of Asia claims that Samsung is cutting the OLED panel production by more than 50% for the January-March quarter. On a facility that Samsung Display had dedicated to producing panels exclusively for Apple's use, it could see production rates drop to half or less.
The iPhone X, since its splashy debut, has struggled to meet Apple's lofty sales goals.
The Korean company is yet to decide its production target for the April-June quarter, but Nikkei speculates that a "further cutback may be in store". At one point during the height of the iPhone X hysteria, it was predicted that Samsung could make as much as $22 billion on iPhone X sales. Unofficially dubbed the iPhone X Plus, the smartphone is believed to keep the overall design of the current model but increase in both physical and screen size, replacing the iPhone 8 Plus in the process.
The local carriers sold discounted iPhones, particularly iPhone 6 and 6s, to clear the inventory and to be honest, these devices came with a lot of value attached to them.
Samsung isn't the only Apple OLED display provider to be hit by falling shares either. That Samsung display is by far the most costly component in Apple's smartphone. The issue of battery throttling did not impact the iPhone demand in Korea and this was in Apple's favor by a huge margin. Only at the beginning of this year did Samsung's bezel-less screens make it to the company's premium mid-range phones - the Galaxy A8 (2018) and Galaxy A8+ (2018), albeit not the curved kind seen on the Galaxy S8.
The latest report additionally says that the bad news may not end there. For a supplier, the more components you can sell, the more profit you make. Because of poor iPhone X sales, Samsung will see a year-on-year decline in profits, instead of the expected windfall.