The iPhone’s 18 Dynamic Island could get smaller, according to a new report

An unverified Weibo leak claims Apple is testing a "micro-transparent glass panel" to place some Face ID components (infrared flood illuminator, VCSEL dot‑projector and structured‑light receiver) under the display, which could shrink the Dynamic Island to a smaller cutout or a punch‑hole while likely leaving the main front camera outside the display. The report says the technology is only in testing, could be confined to Pro/Pro Max models if released, and suggests changes may arrive around the iPhone 18 cycle with further redesigns targeted for the 20th‑anniversary iPhone in 2027.

Analysis

A Weibo leak from account “Smart Pikachu” claims Apple is testing a "micro-transparent glass panel" to relocate some Face ID components (infrared flood illuminator, VCSEL dot-projector and structured-light receiver) under the display while likely leaving the main front-facing camera outside the panel. The report says this is only in testing, could be limited to Pro or Pro Max variants, and offers no photographic evidence or named sources, which keeps credibility low relative to firm supply-chain confirmations.

Technically, moving those sensors under the display could shrink the Dynamic Island to a smaller cutout or a punch-hole, which the article links to potential design changes around the iPhone 18 cycle and further revisions timed to Apple’s 20th-anniversary model in 2027. Prior rumors about eliminating the cutout are noted, but the article emphasizes shifting timelines and uncertainty about model allocation.

Market impact is characterized as mildly positive but speculative with a low market-impact score; absent corroborating supplier orders, images, or Apple confirmation, the news is unlikely to drive durable re-rating. Investors should treat this as a technology-development signal to monitor (especially VCSEL/structured-light component activity) rather than as a basis for immediate position changes.

Key Decisions for Investors

• Do not reallocate material AAPL exposure based solely on this unverified Weibo leak and await corroborating supply-chain or Apple confirmation
• Monitor vendor order flow, inventory builds, shipping notices, and photographic evidence for VCSEL, infrared flood illuminator and structured-light receiver suppliers as leading indicators before increasing exposure
• If supplier confirmations or Apple announcements emerge supporting under-display Face ID, consider tactical exposure to Apple and select component suppliers with modest position sizing while reassessing competitive and product-timing risk