Market Insight

[Display Dynamics] Large-area display shipments beat expectations in Q1 2018

May 31, 2018

Yoonsung Chung Yoonsung Chung Director, Large Display

Want to learn more?
Have an expert contact you.

Key findings

  • Despite slower end-market demand, large-area display unit shipments grew 6% Y/Y and area shipments grew 10% Y/Y in the first quarter of 2018.
  • Panel prices have been falling since mid-2017, and large-area display revenue decreased 11% Y/Y. To consume increased capacity and shipments, panel prices will continue falling unless demand recovers.
  • BOE remained #1 in large-area display unit shipments in Q1 2018, holding that rank since they took it for the first time in Q3 2017. However, Korean panel makers maintained their area shipment leadership.
  • LG Display became #1 in market share with 22%, followed by Samsung Display with 17% in Q1 2018.

Large-area display shipments were expected to be low in Q1 2018 due to slower end-market demand. Brands tend to focus on clearing carry-over inventory in the first quarter before launching new models, which explains the seasonally weak first quarter of most years. Also, top-tier TV brands focus less on volume growth.

The Q1 2018 large-area display forecast was not bright, but unit shipments grew 6% Y/Y, and area shipments grew 10% Y/Y in that quarter. Meanwhile, revenue decreased 11% Y/Y due to display panel price erosion since mid-2017.

Why did shipments grow even though demand slowed? One reason is that display panel production capacity increased in China. Chinese panel makers tend to focus on high utilization and output performance, regardless of demand, which explains the Y/Y shipment increase.

The Q/Q shipment trend is also interesting. During 2015-2017, large-area display unit shipments were down 10% Q/Q in the first quarter, and area shipments were down 8% Q/Q on average. Shipments in the first quarter typically decrease Q/Q due to seasonal effects. Q1 2018 shipments decreased Q/Q, but it is less of a decrease than the past three years, and less than expected. However, due to continuous display panel price erosion since the middle of last year, panel makers have been disappointed with revenue growth.

Overall demand (and shipments) from the panel maker perspective looks better than expected, but the key concern is how to increase panel prices and when. TV display is the key factor, with 12% Y/Y unit shipment growth and 11% Y/Y area shipment growth in the first quarter. Unit shipments for 55‑inch and larger TVs grew 20% Y/Y in the first quarter, so the size migration trend is still strong.

Along with the TV size migration trend, high-end TV display panel shipments also increased. Unit shipments of 4K TV displays were 24.6 million, up 19% Y/Y. Unit shipments of OLED TV displays reached 0.6 million up 110% Y/Y in the first quarter of 2018.

BOE leads large-area display unit shipments with 22% share (shown in the figure below), followed by LG Display with 20% and AUO with 16% in the first quarter of 2018. BOE remained #1 in large-area display unit shipments in Q1 2018, holding that rank since they took it for the first time in Q3 2017.

Korean panel makers maintained their leadership in area shipments since they are strong in TV display. LG Display became #1 in market share with 22%, followed by Samsung Display with 17% in Q1 2018 (shown in the figure below).

Research by Market
Displays
Share facebook Twitter Google Plus Linked In Add This Contact Us