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South Korean company LG Display, which is a key supplier of Apple, has cut by 2.7 billion USD its investment plans by 2020, due to concerns over the global smartphone market. At the same time, the company reported a loss for the second consecutive quarter. The cancellation of the investment plans highlights the poor forecast for electronics manufacturers and is happening a week after another Apple supplier, Taiwan Semiconductor Manufacturing, also cut its revenue and investment forecasts.

“This is a conservative approach that is the result of uncertainty around the mobile market”, said Chief Financial Officer of LG Display, Sang-Don Kim.

LG announced it would cut by 3 trillion KRW (2.7 billion USD) its planned investments by 2020, without revealing what the previous common target was. The company also warned could adjust production in South Korea and China in response to trade disputes between Washington and Beijing.

Cutting the investment will not affect plans to “accelerate redirection” from the core business for production of LCD displays to the next generation of OLED panels. The investing plans at 20 trillion KRW in OLED screens by 2020 remain unchanged, which means that the cuts will primarily affect LCD operations.

The LG’s OLED display business has not yet generated a profit, but the company says it will have a positive effect on its third-quarter results. LG is focused on investing in OLED technology, which has strong positions in large OLED TV screens.

The change happens at a time when traditional LCD business, which accounts for more than 90% of LG sales revenue, is struggling with falling prices and rapidly expanding Chinese players in the sphere of increased production.

The prices of 50-inch LCD TV-sets dropped by 38 percent in May compared to the same month last year.

LG Display reported an operating loss of 228 billion KRW (202.1 million USD) in Q2 2018, affected by the decline in screen prices. The revenue for the quarter between April and June fell by 15% to 5.6 trillion KRW (4.97 billion USD).