Samsung investing heavily in OLED display production

Samsung has announced plans to invest 4 trillion won ($3.6 trillion) into organic light-emitting diode (OLED) production for medium and small-sized panels found in mobile and other consumer electronics products.

The investment will be spread between 2015 and 2017 and could help Samsung offset falling revenues resulting from the well documented decline in the company’s handset sales.

We have already seen similar boosts to Samsung’s semiconductor business help prop up profits last quarter and the company is expected to begin building a 15.6 trillion won chip production plant in South Korea within the next few months. The outlook for Samsung’s various component manufacturing arms seems much more positive than mobile sale expectations.

According to analysts, the new production line will likely initially focus on production for Samsung’s own products, such as curved panels for the Galaxy Note Edge and rumored Galaxy S6 curved displays. Further down the line, Samsung could begin providing OLED products to rival mobile firms who don’t have their own production capabilities. However, LG Display, Samsung’s largest competitor in the flexible display space, is reported to be investing between 1 and 1.2 trillion won into additional OLED production capacity later this year also.

With mobile shipments slowing over the past 12 months, Samsung may become increasingly reliant on external customers for revenue growth. The company’s leading OLED and semiconductor production technologies could well become increasingly important aspects of Samsung’s business model in the next few years.