Key points
- Fine M-Tec drops 15.7% amid iPhone Duo screen complaints
- Fine M-Tec denies a defect in its parts
- Hyundai Motor Securities raises its Fine M-Tec target after the selloff
Fine M-Tec (441270) shares fell 15.7% on October 26 as photos of cracked iPhone Duo screens circulated online. The Korean company, reportedly a parts supplier for Apple's first foldable phone, denied that defects in its components caused the reported problems.
The shares closed Monday at 9,400 won ($7.08), then recovered some ground Tuesday, rising 5.32% to 9,900 won ($7.46). The iPhone Duo went on sale on October 23, just days before buyers began reporting cracks along the inner screen's fold.
In a statement posted Monday morning, Fine M-Tec said, "The quality issue reported in some recent products isn't caused by a quality defect in the parts we supply." It added, "To directly connect an individual problem in a finished product to a defect in a specific part, an objective, technical review has to come first."
Fine M-Tec makes the metal plate under the screen
Fine M-Tec's main product is a backplate, a thin metal plate that sits behind a foldable phone's display and supports the panel where it bends. It's sometimes called an inner hinge. It's a different part from the mechanical hinge that joins the two halves of the phone, Seoul Economic Daily (서울경제) explained.
The company's statement doesn't mention Apple or the iPhone Duo by name, and neither company has officially confirmed a supply deal. People in the industry say Fine M-Tec started shipping backplates for the iPhone Duo at the end of the third quarter, and won most of the first orders after a Chinese competitor had trouble with production yields, the paper reported.
The repair shop iFixit took the phone apart and said the cracks line up with the spot where the hinge support structure changes, according to Seoul Economic Daily. The paper distinguished the hinge mechanism discussed in the teardown from Fine M-Tec's backplate. Apple hasn't publicly identified the cause. Fine M-Tec's statement and the teardown account don't establish what caused the failures.
Fine M-Tec also said it would consider civil and criminal steps against anyone who names it as the cause without objective evidence and damages its reputation.
Apple says only a small number of phones are affected
Apple responded on October 26. "We are aware of an issue impacting the inner display on a small number of iPhone Duo units," the company said in a statement to 9to5Mac, MacTech reported. Apple told users who have problems with the display to contact AppleCare for a replacement. It didn't give a cause or say how many phones were affected.
In Korea, the iPhone Duo starts at 3.29 million won ($2,479). An inner screen repair outside warranty costs 1,649,000 won ($1,243), Seoul Economic Daily said.
A broker raised its target after the fall
On October 27, Hyundai Motor Securities raised its target price for Fine M-Tec to 14,500 won ($10.93) from 11,500 won ($8.67). That's about 46.5% above Tuesday's close, by our calculations. The broker kept its buy rating.
"This concern is only short-term noise," analyst Kim Jong-bae wrote, according to Financial News (파이낸셜뉴스). Hyundai Motor Securities attributed the problem to other components and assembly yields, rather than Fine M-Tec's backplate.
"If anything, Fine M-Tec has taken some market share because of competitors' quality problems, and it's keeping its position as first vendor," Kim wrote, according to Asia Economy (아시아경제). "There's no change in demand at the mass production stage, and it's producing at its maximum monthly capacity."
The broker expects Fine M-Tec's third-quarter revenue to reach 137.6 billion won ($103.7M), up 139.1% from a year earlier, with operating profit of 19.1 billion won ($14.4M). The broker said Fine M-Tec makes about 1.5 million backplates a month and could expand that capacity by 30% or more next year.
In September, Korean electronics suppliers were asked for price cuts of 10 to 20 percent, including by Apple.
Meanwhile, Fine M-Tec's stock had risen 10.29% on October 23, the day the iPhone Duo went on sale.
Quotes from Fine M-Tec and Hyundai Motor Securities are translated from Korean. Apple's statement is quoted in its original English. Won figures are converted at 1,327 won to the dollar, the Naver Finance rate on October 27, 2026.
