Apple quietly acquired a company called LuxVue in 2014 that was working on low-power MicroLED display technology. A report by Bloomberg indicates that development has continued and that Apple is making a "significant investment" in the new technology with an eye toward including them in devices like the iPhone or Apple Watch in a few years.
Like OLED (used in the Apple Watch and now iPhone X), MicroLED tech doesn't need a backlight, so it could provide better contrast while using less power, but since it has to be assembled one sub-pixel at a time (each pixel requires three), it hasn't come to the mass market yet. Samsung plans to release its The Wall modular television built with MicroLED in August.
The rumor claims that Apple made its first Apple Watch MicroLED prototype last year, and the device has previously been reported as an initial target for the technology. The "T159" project where engineers are working on design and production is reportedly done inside a large manufacturing facility in Santa Clara, as it works on a way to replace technology designed by competitors like Samsung and LG. Just like the custom-designed processors used in its mobile devices, Apple would still likely have others build the actual displays, but if it's first to MicroLED then it could offer another level of quality (and power-efficiency) than anyone else can provide.