OLED emission material companies recorded high first quarter earnings that beat market expectations.
Apple’s iPhone 12 sales, Samsung’s earlier than usual launch of Galaxy S21 smartphones, expanded application of OLED panels in notebooks and mid-tier phones, and Chinese panel makers expanding their OLED production affected the profits of DS Neolux and Universal Display Corporation (UDC) positively.
UDC recorded US$134 million in sales and US$63.6 million in operating income in the first quarter. Sales increased 19.3% year-on-year.
Sales of its material unit was US$79.8 million, much higher than the US$66.6 million of a year ago, despite the first quarter traditionally being the off-season, thanks to Apple’s iPhone 12 sales which continued strong through the quarter and Samsung’s launch of the Galaxy S21 series.
BOE and CSOT are also seeing their mobile OLED lines activate at a higher rate than previously. BOE said it shipped 36 million flexible OLED panels last year and is planning to double the figure in 2021.
UDC CEO Steven Abramson said OLED applications has expanded from premium products to low- and mid-tier products. Demand from OLED TV was also increasing, he said.
Citing data from Omdia, the CEO said the average panel price of 55-inch OLED panel has dropped 8.1% in the quarter from a year prior, while those of liquid crystal display panels increased 73.9% in the same time period.
The price between OLED TV and LCD TV has also narrowed from US$440 to US$310, he stressed.
UDC had signed a patent licensing agreement with LG Display back in 2015. The pair has recently extended the contract. LG Display, the only manufacturer of large-sized OLED panels for TVs, is planning to ship between 7 million to 8 million units of OLED panels.
Samsung Display had also said it plans to ship five times the OLED panels this year compared to a year prior. Samsung Electronics launched its Galaxy Book Pro series last month, which all use OLED panels. Xiaomi and Dell has also launched OLED smartphones and notebooks, respectively. Nintendo is also planning to apply OLED panels to its new gaming console Switch Pro.
UDC said it expected sales between US$530 million to US$560 this year.
Meanwhile, DS Neolux recorded 42.7 billion won in sales and 11.5 billion won in operating income.
This beat South Korean analysts’ expectations of 39 billion won in sales and 11 billion won in operating income.
DS Neolux’ sales jumped 34.3% and operating income 68.3% from 2020.
The company also benefited from iPhone 12 ans Galaxy S21. It will supply OLED materials in the second quarter to Samsung for its upcoming foldable phones and Apple’s iPhones that will launch later this year.
DS Neolux is expecting sales of 180 billion won and operating income of 52 billion won this year. If achieved, this will be 24.7% and 30.4%, respectively, from 2020.
Solus Advanced Materials’ electronics material business, which also supplies OLED materials, saw record sales in the first quarter. It supplies aETL for Samsung Display’s mobile OLED displays. The company also supplies materials for quantum dot (QD)-OLED TV samples Samsung Display is making.