OLED Utilization Expected to Improve in 2020 vs. 2019

Published March 24, 2020

Utilization of flexible OLED lines across the display industry has been stubbornly low throughout 2018 and 2019 because of industry oversupply, but utilization rates are expected to improve in 2020 while remaining far short of full UT%, according to the latest update to DSCC’s Quarterly OLED and Mobile LCD Fab Utilization Report released this week. The report details monthly capacity and utilization for OLED lines and LTPS LCD lines, with capability to sort by parameters such as country, substrate type, supplier, form factor and glass size.

The first chart from the report included here shows the total monthly industry TFT capacity for flexible and rigid OLED and for LTPS LCD. While total OLED capacity surpassed LTPS LCD in 2018, the component parts rigid and flexible remain lower than LTPS LCD, but flexible OLED capacity is closing the gap in 2020. The shutdown of Japan Display’s Hakusan plant in mid-2019 removed roughly 7% of the industry’s LTPS LCD capacity and expansions by BOE and others will continue to increase flexible OLED capacity.

OLED and Mobile LCD TFT Capacity, 2018-2020

Source: DSCC’s Quarterly OLED and Mobile LCD Fab Utilization Report

The next chart shows forecasted TFT glass input across the same technologies. Input of both LTPS LCD and flexible OLED increased in the second half of 2019 showing similar seasonal patterns, while rigid OLED has shown almost the opposite seasonality, with a Q4 slowdown in both 2018 and 2019. Flexible OLED input in Q1’20 is holding at roughly the same levels as Q4 2019, with lower input by Samsung offset by higher input by BOE. We expect flexible OLED input to increase dramatically in the 2nd half of 2020, based on the increased demand from new iPhone models along with increasing input by BOE and LGD to serve other brands with a particular emphasis on 5G models.

OLED and Mobile LCD TFT Input, 2018-2020

Source: DSCC’s Quarterly OLED and Mobile LCD Fab Utilization Report

The final chart here shows the resulting utilization ratios. In the case of flexible OLED utilization, while the same seasonal pattern is the same in 2020 as 2019, we see significant increases with Q1’20 in the high 40s vs. Q1’19 in the high 30s. Similarly, rigid OLED in Q1 2020 has run roughly 10 points higher than the corresponding period in 2019 and we expect that to continue through the year. Rigid OLED capacity is benefiting from increased demand from the notebook market.


OLED and Mobile LCD Utilization, 2018-2020

As previously indicated, the report reveals fab by fab utilization levels. Samsung’s A3 fab is by far the largest flexible OLED fab in terms of capacity, and lower utilization at A3 keeps the industry average down in Q1 and Q2, but higher UT% on A3 and A4 will bring the industry average up in the 2nd half of the year driven by Apple’s seasonal demand. BOE’s B7 line in Chengdu was nearly idle in Q3 2019 after BOE lost Huawei’s business for the Mate 30 Pro, but UT% recovered in Q4 as BOE has regained Huawei business for the P40 and is continuing to improve as BOE has started shipments for the Xiaomi Mi 10, Vivo X31 and Oppo Reno 5G.

DSCC’s Quarterly OLED and Mobile LCD Fab Utilization Report tracks TFT capacity and utilization across 41 OLED and LTPS LCD fabs across this industry, allowing segmentation by supplier, glass size, country, backplane technology, frontplane technology and substrate type. For more information about the report, please contact Gerry McGinley at 770-503-6318, e-mail gerry@displaysupplychain.com or contact your regional DSCC office in China, Japan or Korea.

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Written by

Bob O'Brien

bob.obrien@displaysupplychain.com