Apple supplier Sharp plans to halt production at its Kameyama K2 factory in August after a sale to Foxconn fell through, potentially disrupting supply of oxide LCD panels for some MacBook and iPad models. The Japanese display maker announced the decision on an earnings call, citing increased competition from Korean and Chinese panel makers.

TrendForce estimates Apple accounts for only 16-17% of the factory's utilization, giving the company about six months to adjust. The facility's oxide backplane technology once set industry benchmarks for Apple's MacBook and iPad displays, but investments by competitors have steadily eroded Sharp's technological advantage. Foxconn had initially planned to continue LCD production while adding AI server lines, but backed away due to weak panel prices.

While the short-term impact may be limited given Apple's supply chain expertise, the closure underscores the company's accelerating shift toward OLED displays. All current iPhone models use OLED technology, as do the latest iPad Pro generations. Apple plans to transition its entire product lineup, including the iPad mini, iPad Air, MacBook Pro, MacBook Air, and iMac, to OLED displays over the next one to two years, potentially minimizing future dependence on traditional LCD suppliers.