Recent financial reports show that panel makers in Taiwan and South Korea generally performed poorly in the first quarter of this year. In addition to the decline in market panel prices, the iPhone's demand was lower than expected and it also caused the suppliers to thwart.
South Korea’s Samsung Electronics (005930-KR) reported an excellent overall earnings, but the display division’s operating profit this year dropped by 68% to KRW 410 billion (US$379 million), the lowest since the seventh quarter.
Samsung controls about 90% of the global market for small and medium-sized OLED panels, mainly for mobile phone and automotive applications, but these markets have suddenly slowed down, an important reason is the iPhone X. Samsung originally estimated the first quarter of the iPhone X provided 45 million. To 50 million OLED panels, but it is believed that less than 20 million actually shipped, some people expect the iPhone X sales will fall to 15 million in the second quarter.
LG Display (034220-KR) announced on Wednesday that its first quarter operating loss was 9.8 billion won, the first loss in six years, compared with 1.02 trillion won in the same period last year. In 2017, LG Display won The recorded operating profit was mainly attributed to the increase in prices. However, the price has now fallen by 11% from three months ago.
Taiwan’s AUO (2409-TW)’s financial report released on Thursday also saw its operating profit in the first quarter significantly reduced to NT$2,965 million.
With the slowdown of the global smart phone market, LG Display and AUO are both in trouble with the shipment of LCDs, and TV panels are also lacking in development. It is expected that this quarter will continue to deteriorate.
After the heat of 2017, the panel industry faced greater challenges this year. On the other hand, the rise of BOE Technology Group, a Chinese manufacturer, significantly increased production, which also depressed the market price.
In the OLED segment, due to the slow recovery, it also poses a risk to Samsung's dominance, because BOE will invest large sums of money in its small and medium-sized OLED business.
The report pointed out that some Taiwanese manufacturers that are difficult to compete with the mainland and South Korea, such as Innolux, may focus on niche markets such as medical equipment.