Market Insight

[Display Dynamics] AMOLED smartphone panel shipment forecast for 2017

July 12, 2017

Brian Huh Brian Huh Principal Analyst, Small/Medium Displays

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Key findings

  • In the second quarter of 2017, IHS revised its flexible AMOLED panel shipment forecast for 2017 upward 5% from the previous forecast, citing higher-than-expected sales of Samsung Electronics’ smartphones with a wide screen as well as plans by its rivals to launch models with a wide screen.
  • However, the rigid AMOLED panel shipment forecast for 2017 was revised downward by 20% from the previous forecast due to a fall in demand following weaker-than-expected smartphone sales in China and slow growth in Samsung Electronics’ demand for OLED panels.

The AMOLED display market for smartphones has significantly expanded over the last few years. In particular, demand for flexible AMOLED panels has steadily risen since they were first adopted in smartphones in 2013. Full-fledged mass production began in 2014, and flexible AMOLED panels have emerged as a standard display for premium smartphone lineups, including Samsung Electronics’ Galaxy series.

The rigid AMOLED display market had also grown significantly since 2015 thanks to the strong performance of China-based Oppo Mobile Telecommunications (Oppo) and Vivo Communication Technology (Vivo), which have higher demand for AMOLED panels than other Chinese brands, as well as Samsung Electronics’ continuous shift from TFT LCD to AMOLED in its mid-range smartphones.

In 2017, the AMOLED smartphone display market is expected to get an additional boost from Apple’s adoption of flexible AMOLED screens for its new iPhone series. In early 2017, amid expectations of an increase in demand for AMOLED displays, AMOLED smartphone display makers set much higher sales targets for 2017 than their 2016 sales.

However, in the OLED Display Market Tracker – Q2 2017, IHS revised downward its AMOLED smartphone display shipment forecast for 2017 by 13% to 445 million from its previous forecast of 513 million. This indicates that demand for AMOLED smartphone panels did not increase as much as expected in early 2017. By substrate solution, the flexible AMOLED panel shipment forecast for 2017 was revised upward by 5%. The rigid AMOLED panel shipment forecast was cut by as much as 20%.

Flexible AMOLED smartphone display market to grow in 2017

As a wide screen is rapidly gaining popularity in the smartphone segment, a growing number of smartphone makers are considering adopting AMOLED panels for their flagship models. A flexible AMOLED panel is a perfect choice for a wide screen. Unlike a TFT LCD panel, it does not require a backlight unit and uses a flexible polyimide (PI) substrate, offering more design freedom for smartphones and allowing the creation of a variety of form factors.

Apple will apply flexible AMOLED displays to its new iPhone series, which is slated to be out this year, and LG Electronics is expected to adopt LG Display’s plastic AMOLED panel on its flagship phone, temporarily dubbed V30, which is scheduled to be released in 2H 2017. Samsung Electronics’ Galaxy Note 8 will hit the market soon. Many Chinese brands are also considering flexible AMOLED screens for their flagship models, so the flexible AMOLED smartphone panel market will likely grow explosively this year.

Thus, even though there has been a delay in mass producing AMOLED panels for Apple’s iPhone, which will likely lead to a decrease in overall AMOLED panel shipments, IHS revised upward the flexible AMOLED panel shipment forecast for 2017 in OLED Display Market Tracker – Q2 2017 by 5% from the estimate made in the previous quarter.

Rigid AMOLED market facing stagnant growth and growing competition

Rigid AMOLED display shipments surged to 350 million in 2016, up 54% Y/Y. According to the IHS OLED Display Market Tracker – Q1 2017, rigid AMOLED display shipments were expected to reach 360 million in 2017, up 3% Y/Y, thanks to the aggressive sales targets of Chinese brands with a high ratio of AMOLED smartphones as well as expectations for a shift to AMOLED by smartphone makers that have mainly produced LCD smartphones.

However, smartphone sales by Chinese brands in the first three months of 2017 came below expectations. This prompted a downward revision in their sales target for 2017, weighing on demand for rigid AMOLED displays. Rigid AMOLED panel demand from Samsung Electronics, a major rigid AMOLED panel customer, has also remained stagnant this year because the global smartphone giant has increased adoption of TFT LCD to low-end and mid-range products since late 2016. Moreover, the LTPS LCD smartphone industry is making all-out efforts to make up losses that would be caused by Apple’s decision to adopt flexible AMOLED panels to the upcoming iPhone series, seeking new demand in China and looking to develop competitive technologies. Under the circumstances, it looks difficult for the rigid AMOLED sector to boost shipments.

Accordingly, IHS revised downward its rigid AMOLED panel shipment forecast for 2017 by 20% to 286 million from the estimate made in the previous quarter.

AMOLED display shipments in the second half of 2017 will depend on the shipments of flexible AMOLED displays for Apple’s iPhone, the sales results of Samsung Electronics’ Galaxy Note 8, the development and mass production schedule of wide-screen displays with an 18:9 aspect ratio, and the adoption ratio of AMOLED panels in Samsung Electronics’ 2018 models.

Learn more about this topic at the Global Display Conference 2017

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