Counterpoint Research
info@counterpointresearch.com
FOR IMMEDIATE RELEASE: 02/03/2025
Flat Panel Display Fab Utilization Increasing in Q1 2025
-
- The Q4 2024 slowdown in fab utilization ended earlier than expected and utilization has increased since November.
- LCD fab utilization is increasing in Q1 2025 with increased demand for TV and IT products.
- OLED utilization will be higher YoY in Q1 2025 as the seasonal slowdown is milder than prior years.
After a slowdown that started in the summer of 2024 and extended to the National Day holiday in October, flat panel display fab utilization started to increase in the last months of the year and is increasing further in Q1 2025, according to the latest release of Counterpoint Research’s Quarterly All Display Fab Utilization Report, issued last week. Panel makers appear to be responding to stronger demand signals.
Worldwide fab utilization dropped slightly QoQ in Q3 2024 despite sequential increases in utilization in South Korea and Taiwan, as utilization in China fell. Utilization dropped further in Q4 2024 as input fell in all regions except Japan.
Although the fourth quarter as a whole was a slowdown from Q3, almost all of the reduction came in October, as Chinese panel makers took an extended National Day holiday. Utilization increased in November and December as demand increased in China driven by government programs for consumers and as IT and TV brands built inventory to ship to the US to avoid tariffs before the Trump Administration took office.
We expect utilization to increase further in Q1 2025, closer to the pace of inputs in November and December 2024. The demand for TVs remains solid and the normal seasonal slowdown in the smartphone market appears to be milder this year.
South Korea has a dramatically higher share of its capacity as OLED, while all other regions are dominated by LCD. The slowdown in utilization in Q3 2024 was confined to LCD as shown on the chart here, as OLED line utilization reached a seasonal peak with demand for smartphones and improvement in OLED TV demand. OLED fab utilization fell more dramatically than LCD in Q4 2024, with a big slowdown on LGD’s OLED TV lines to control inventory. The industry’s total utilization closely follows the LCD line as OLED capacity represents only 10% of total FPD capacity.
TFT Quarterly Fab Utilization by Frontplane, 2023-2025
Turning to mobile displays, rigid OLED has increased from low levels in 2023 to reach the 70% range since Q2 2024 as demand for rigid OLED panels for notebook PCs continues to increase and demand for rigid OLED smartphone panels has increased at the expense of LTPS LCD. Both rigid OLED and LTPS LCD serve the lower and mid tiers of the smartphone market which exhibit less seasonality than the premium segment. Higher-end smartphones use flexible OLED panels, and flexible OLED has settled into a consistent seasonal pattern of lower UT% in the first half and higher UT% in the second half of each year, driven primarily by Apple’s product introduction cycle and holiday sales. The seasonal pattern was more muted in 2024, with a lower seasonal peak in Q3 2024 and a softer seasonal slowdown in Q1 2025.
2024 was a recovery year for the display industry, as the supply/demand balance started to right itself through decreased supply (the closure of Sharp’s Sakai G10 fab) and increased demand (improvement in IT demand and larger TV screen sizes). Total industry capacity continues to exceed demand for displays, but that gap is much smaller than in 2022-2023. With demand drivers uncertain, the industry will need to continue to restrain utilization to avoid shifting the supply/demand balance into oversupply, but that restraint may look like a “tap on the brakes” in 2025 as compared to “slam on the brakes” in 2023 and 2024.
Counterpoint Research’s Quarterly All Display Fab Utilization Report covers capacity, TFT Input and utilization by month for every flat panel display fab in the industry, with pivot tables to allow segmentation by supplier, country, TFT fab generation, backplane, frontplane or substrate type. The report provides historical utilization back to Q1 2019 and a forecast by month for the first half of 2025. Counterpoint Weekly readers interested in subscribing to the Quarterly All Display Fab Utilization Report should contact info@counterpointresearch.com.
About DSCC
Counterpoint Research acquired DSCC (Display Supply Chain Consultants) in 2023, joining forces to become the premier source of display industry research globally. The partnership combines Counterpoint’s thought leadership and expertise across the broader tech sector and DSCC’s deep specialization in display technologies to provide an unparalleled resource for insights and analysis for our clients.