OLED Panel Revenues to Exceed $50 Billion by 2023

Published March 26, 2019

DSCC has updated its Quarterly OLED Shipment and Fab Utilization Report for Q1, and the report contains a treasure trove of data for analyzing and understanding the OLED industry, some of which we will share here. The report covers units, area, screen sizes, revenues and ASPs for eleven different applications of OLED panels, plus supply chain relationships for phones and TVs and fab utilization figures for OLED and LTPS LCD fabs.

​Last month in the DSCC Weekly Review, we had discussed this report and described the Q4 2018 results and the full year 2019 forecast, and separately we reported on the update to fab utilization, so for this issue we will turn our attention to some of the quarterly data in our outlook for 2019 and on our long-term forecast. Our first chart covers OLED units shipments by application. While smartphone remains the dominant application (in unit terms) for OLED, Smart Watch has firmly established itself in the number two position, with nearly 15% of OLED units in Q4 2018 in this application. Smartphone and Smart Watch together make up 97% of OLED panel units.

OLED Panel Shipments by Application by Quarter, 2018-2019

Source: DSCC Quarterly OLED Shipment and Fab Utilization Report

The next set of two charts shows the OLED smartphone panel unit shipments by panel supplier, and the need for two charts for this topic is clear evidence of Samsung’s dominance in this space – on a single chart none of Samsung’s competitors would be visible. As the chart shows, though, these competitors are making significant progress in increasing output. Samsung’s unit share of OLED smartphone panel shipments, which was 97% in Q1 2018, will slip to 81% by Q4 of 2019. Nevertheless, Samsung’s dominant position will remain, as it will have more than 10x as many unit shipments as its nearest competitor, and the disparity in revenues will be even greater.

OLED Smartphone Panel Shipments by Panel Supplier by Quarter, 2018-2019

Source: DSCC Quarterly OLED Shipment and Fab Utilization Report

Visionox surpassed LGD to take the #2 position in OLED panel units in Q1 2019, but the unit number may overstate their prowess since 90% of Visionox’ shipments are in a 5.5” low-end model. While it is improving output, LGD has struggled with quality issues on its OLED smartphone panels for Huawei. We do expect, though, that LGD will regain its #2 position with strong growth in the 2nd half of 2019. BOE will establish itself as the #3 player on the strength of sales to Huawei for the Mate 20 pro and the Mate 30 pro.

LG has established itself as the leader for Smart Watch panels, as shown in the next chart, with Samsung, Everdisplay, and BOE trailing. As noted above, Smart Watch is a clear #2 in units among applications, and although these panels do not amount to much screen area, the high panel prices generate revenues and profits.

OLED Smartphone Panel Shipments by Panel Supplier by Quarter, 2018-2019

Source: DSCC Quarterly OLED Shipment and Fab Utilization Report

LGD remains the only panel supplier in the TV space, and that allows LGD to take a clear #2 position in OLED revenues, but again Samsung’s dominance is clear as shown in the next chart. Samsung accounted for 80% of OLED revenues in Q4 of 2018, but LG will continue to grow with both increased TV capacity from the start-up of its fab in Guangzhou and additional shipments of smartphone and Smart Watch panels as noted above. We expect LGD to increase to 23% share of revenues by Q4 2019.

OLED Panel Revenues by Panel Supplier, 2018-2019

Source: DSCC Quarterly OLED Shipment and Fab Utilization Report

The report also includes panel revenues by brand for both smartphones and TVs. In smartphones, Apple accounted for nearly 47% of OLED panel revenues in Q4 2018, and together with Samsung the two leaders accounted for more than 76% of revenues. We expect this share to decline slowly as other brands, led by Huawei, Oppo, and Vivo, increase their OLED panel purchases. In TV, LG has been the largest client, representing 59% of revenues in Q4, but Sony has increased its purchases of OLED TV panels and in Q4 represented 22% of panel purchases.

The Q1 update also includes DSCC’s latest 5-year forecast of OLED shipments. We expect that OLED panel revenues will increase from $26.5 billion in 2018 to more than $52 billion in 2023, as shown in the next chart.

OLED Panel Revenues by Application, 2018-2023

Source: DSCC Quarterly OLED Shipment and Fab Utilization Report

While we expect smartphone to remain the largest application by value, the growth in TVs, tablets, notebook panels, and monitor panels will have all of those applications exceeding $1 billion in revenues by 2023. On an area basis, TV will be roughly equal to smartphone in 2020 (47.6% of all OLED panels vs. 48.0%) but will surpass smartphone in 2021 and increase to 58% of OLED area by 2023, with smartphone declining to 34%. In unit terms, though, smartphones will continue to dominate throughout the forecast period; even in 2023 we expect that 86% of OLED panel units will be smartphones, with 931 million OLED smartphone panels selling that year. We expect that Smart Watch will sustain its #2 position for OLED units with 75 million or 7% of units.

As noted above, DSCC’s Quarterly OLED Shipment and Fab Utilization Report provides a comprehensive listing of historical panels shipments for all applications, plus a forecast of units, area, ASPs, screen sizes, resolutions, panel suppliers, and revenues for each application. The report includes an Excel file with pivot tables for detailed analytical cuts plus a Powerpoint that summarizes the highlights. Readers interested in subscribing to the DSCC Quarterly OLED Shipment Report should contact gerry@displaysupplychain.com.

Image Description
Written by

Bob O'Brien