Misek believes that Apple has bought between $500 million and $1 billion worth of manufacturing equipment for Sharp's Gen 6 Kameyama manufacturing facility which will be used to build displays for iOS devices.
Also, we believe that Apple and Sharp together have a modified IGZO (indium, gallium, zinc) technology to achieve 330 dpi, which is sufficient for an HD display while not using IPS nor having to include dual-bar LED backlighting. In our view, this should lead to several design advantages, namely the device can be thinner, battery life should be longer, and the overall experience for users should be meaningfully improved.
The deal between Apple and Sharp is said to account for a big chunk of the company's $8 billion capital budget for its current fiscal year. Since that number was revealed in Apple's latest annual report, analysts have been trying to figure out what the 73% increase in spending will be used on.
Misek says, "The IGZO technology is perfect in that it offers near-OLED power consumption while having a lower cost and thinness that is only 25% greater than OLED, based on our checks,"