Nothing has made an update to the Phone (3) display to improve its performance at low brightness, but it’s not a downgrade. Initially, the Phone (3) featured a 2,160Hz PWM rate, which was later reduced to 960Hz via software. 
This change only affects the display when it operates at lower brightness, maintaining the higher 2,160Hz PWM rate when at brighter levels.
According to Nothing, the update was implemented to prioritize picture quality at lower brightness settings, where the display performs best with this new PWM rate. However, the company hasn’t clarified the exact brightness level at which the change kicks in. In a statement provided to Android Central, Nothing explained that this adjustment is a part of the final retail software, though they have not disclosed why this change was needed.
So, what exactly is PWM? PWM (pulse-width modulation) is a method OLED displays use to control brightness by rapidly turning pixels on and off, tricking your eyes into perceiving a dimmer screen. For most users, this technology doesn’t pose any issues. But for some, particularly those sensitive to flicker, lower PWM rates can lead to discomfort like eye strain, headaches, or even nausea.
Despite the concerns, a higher PWM rate can be critical for users prone to such issues. In fact, brands like Honor are stepping up, with devices like the Magic 6 Pro supporting a 4,320Hz PWM rate for dimming under 30% brightness. As for Nothing, while they haven’t gone into specifics about the update’s reasoning, the company has taken steps to improve display quality for those less sensitive to PWM flicker. However, there’s still room for more transparency, especially when it comes to giving users the option to prioritize PWM rates over image quality if needed for accessibility.