The American tech juggernaut is reportedly looking at organic light-emitting diode, or OLED, panels, which make images appear brighter and sharper compared to another technology used for some smartphone screens — liquid crystal display, or LCD.
The smartphone maker recently started planning three new iPhone models for next year and decided that all of them would have OLED panels, the report said, citing unnamed industry sources.
CNBC reached out to Apple for comment but did not immediately hear back.
At the moment, only the iPhone X uses OLED, while the iPhone 8 and iPhone 8 Plus both have LCD screens. Apple was already expected to employ OLED tech in two of its three models to be shipped later this year, according to Appleinsider.
OLED screens result in rich displays, but they are also more expensive. That is why they are usually seen in high-priced smartphone models like the iPhone X.
Apple had been trying to improve the iPhone's display technology with OLED to differentiate its smartphones from competitors, according to Jerry Kang, senior principal analyst at IHS Markit.
Still, the tech giant would only be able to "shift to using OLED panels for all iPhone models once it achieves the market demand with competitive price," Kang told CNBC.
The report from Electronic Times was immediately felt by the stocks of some Apple suppliers.
On Tuesday morning in Tokyo, shares of Japan Display fell more than 20 percent at one point on the back of the news. A shift toward OLED panels for all new iPhones would be initially problematic for the Japanese company, which is one of the main suppliers of LCD screens for Apple.
In late March, the Nikkei business daily reported that the company planned to raise capital so it could start producing OLED panels for the iPhone-maker.
Samsung is currently the exclusive provider of OLED panels for the iPhone X. Still, the news from the Electronic Times did not gives Samsung Electronics shares a boost — shares were down about 1.7 percent by mid-morning in Seoul.
Since Apple usually does not rely on a single supplier for its parts, there have been reports suggesting that the iPhone-maker was considering LG Display as an alternative source for OLED screens.
But LG Display appeared to be having manufacturing problems that caused the company to fall behind the schedule many suppliers follow to begin mass production for new iPhone models, the Wall Street Journal reported in April, citing people familiar with the matter.
Nevertheless, LG Display shares were up 4.32 percent on Tuesday morning.
— Reuters contributed to this report.