1. The large-scale production capacity and the small size fall, and the panel price continued to drop in the second quarter;
TV panel prices have dropped for 3 consecutive quarters since the end of the second quarter of 2017, and there is still no clear stop sign yet. According to the latest research report from TrendForce Optoelectronics Research (WitsView), the price of TV panels in the second quarter is expected to continue dropping. The range of size reductions are as follows: 32 inches 20~22%, 43 inches 13~15%, 49/50 inches 12~14%, 55 inches 9~11%, 65 inches 14~16%.
According to Yangqing Xiang, associate researcher of WitsView, the BOE 10.5 line began mass production delivery in March this year. The price war that represents over 65-inch super-sized panels has just entered the white-hot phase, and the 65-inch strong incensions will gradually allow the 55-inch increase. The size of the mainstream position and price support are threatened. At the end of last year, the 32-inch panel that played the brand impulse and the protagonist's corner, in the case of stock-taking in the FIFA World Cup, has shown signs of declining trend since the second quarter of this year.
BOE 10.5 line production, large-size price war started
According to past experience, in order to receive government subsidies, China's new panel makers will initially complete the production capacity at the fastest rate, rather than relying on investment recovery and depreciation expense calculation as the main consideration. BOE line 10.5 will begin mass production in March this year. It is planned to reach the monthly production volume of 80,000 large plates before the end of this year. It is estimated that the economic cutting size of 65 inches and 75 inches will have a large amount of output, especially the 65-inch production yield and market appetite in the new plant. Under consideration, it will be the main product. In addition, the two 8.6-generation plants of Xianyang Rainbow and Chengdu Panda also joined the war in March and May of this year, which is bound to crowd out the current 8.5 generation mainstream products. 32, 43, 49 and 55 Inch and other product needs.
In terms of brand demand, the second quarter of this year is also not optimistic. First, at the end of last year, the brands actively shipped for the purpose of sprinting the year. However, terminal sales did not have dazzling performance. A lot of inventory is still to be digested. Furthermore, the stock of the World Cup is stocked. Demand also faded after the end of the first season. Finally, the trade war between China and the United States is still pending and the market is full of uncertainties. The brand purchasing strategy for the second quarter of the brand has become conservative.
World Cup Finals Ends, Small Size Needs to Weak
The 32-inch has always been the mainstay of the small-size TV market. The panel price directly affects the brand's subsequent pricing strategy for TV products. After entering the second quarter, the 32-inch demand gradually weakens, but the overall supply has not been adjusted significantly. The 32-inch price reduction was forced to increase, and the price of TVs with dimensions of 32 inches or more was accompanied by a simultaneous decline. Even the original demand for support of the 55-inch price was not equal to the 65-inch price drop. The decline was aggravated. Demand for small-size equipment and large-size production capacity fell. Under pressure, panel prices will continue to drop in the second quarter.
In the second half of the year, if the demand in the peak season warms up, panel makers are expected to get a slight respite.
Looking into the third quarter, the impact of the Sino-US trade war and the promotion of China's 618 will be the key to whether or not the demand will recover. If the demand in the second half of the year can go smoothly, there will be a chance for the panel maker to bring a brief breathing space; Demand is not expected to result in an increase in supply-demand imbalance. It is not ruled out that the panel price will continue to drop to approach the cash cost. At this point, how to balance the market share and cost pressure will be a problem that cannot be avoided by panel makers.
2. Surplus pressure? Panel companies' first-quarter financial reports are "light";
Recently, a number of panel companies announced the first quarter of fiscal year 2018. Revenues, profit margins, and even losses, have become the main case of financial reports. This also means that panel companies may have a hard time this year. .
Panel manufacturer's earnings report
BOE Technology Group Co., Ltd. (hereinafter referred to as 'BOE') recently announced its first quarter report this year.
In the first quarter of this year, BOE’s revenue in the first quarter was approximately 21.567 billion yuan, which was 1.32% lower than the 21.585 billion yuan recorded in the same period of last year. The net profit attributable to shareholders of listed companies was 2.019 billion yuan, which was lower than 2.413 billion yuan in the same period of last year. The rate reached 16.34%. In 2017, BOE realized a net profit of RMB 7.568 billion, an increase of 301.99% year-on-year. Compared with this increase in net profit, the increase in net profit in the first quarter of 2018 was even worse.
South Korea’s LG Display released its first-quarter financial report showing that LG Display’s revenue for the first quarter was 5.7 trillion won (US$5.3 billion), a decrease of 19.6% year-on-year. At the same time, the company’s first operating loss in six years. Its operating loss for the first quarter reached 98 billion won (approximately US$91 million). In contrast, the company’s operating profit was 1 trillion won (approximately US$930 million) in the same period a year ago.
WISCO's well-known panel maker AU Optronics announced its first-quarter earnings report for 2018 showing that in the first quarter, the company reported revenue of approximately 16 billion yuan, a year-on-year decrease of 15.9%, and net profit of approximately 920 million yuan, a decrease of 54.5% from the same period last year.
Innolux's first-quarter performance report for 2018 shows that Innolux's total revenue for the first quarter of 2018 was 14.4 billion yuan, a decrease of 22.4% over the same period of last year.
Panel prices continue to decline
A number of panel companies’ financial reports mentioned 'impacted by the decline in panel prices' when analyzing quarterly results.
According to data from the State Optoelectronics Research Center, global TV panel prices have entered the price inflection point since the second half of last year and fell for 9 months. The demand has not recovered yet. The data shows that the prices of 32-inch to 65-inch TV panels are maintained at 3-10. The decline in the US dollar ranged, especially for the 65-inch large-size panel, which fell significantly from the third quarter of 2017. In March of this year, the average panel price dropped to 300-290 US dollars in April and is expected to fall to 280 US dollars in April.
Another well-known research firm HIS trend data displayed by the TV panel prices will have to moderate their data in February, previously reported, the 32-inch panel prices fell $ 1, by about 2%; 40-inch panel prices fell $ 3吋 The panel price was about 3%; 43吋 panel price dropped by 4 US dollars, with a margin of about 4%; 49吋 panel price dropped by 5 US dollars, with a margin of about 4%; 55吋 panel price dropped by 1 US dollar, which was about 1%. 43 inch, 49-inch panel prices fell the most stressful.
According to the latest data from Sigmaintell, from March to April, the price of the 32-inch panel fell by 3 US dollars in March and April, 39.5吋-43%, the same drop was 3 to 4 US dollars, and the price of the 43-inch panel dropped by 5 US dollars; 49吋-50吋 decreased by 4-5 US dollars; 55吋 decreased by 3 US dollars; 65吋 decreased by 10 US dollars.
The capacity is increasing dramatically
According to the Innolux earnings report, in the first quarter of 2018, the company's large-size consolidated shipments amounted to 28.07 million units, a decrease of 8.1% compared with the 30.52 million units shipped in the fourth quarter of 2017; combined shipments of small and medium size totaled 6857 10,000 tablets, a decrease of 7% compared with 73.7 million shipments in the fourth quarter of 2017.
Globally, global LCD panel shipments fell 10.5% QoQ in the first quarter of 2018. As is customary, quarters are the global low season for stock preparation and weak demand.
At present, under the trend of continuous decrease in panel prices, TV manufacturers have shown a cautious attitude and have not accumulated a large amount of inventory. The industry expects that in the second quarter of 2018, part of the panel prices will bottom out.
According to Liao Bingjie, vice president of China Star Optoelectronics, the share of global shipments above 65吋 is expected to be 13% by 2021. The average size of global TV shipments grows by about 1 inch per year, and the Chinese mainland market develops more rapidly. It is expected to reach 2021. The average size of mainland China is 52.5 inches, and China is becoming the most important supply country for large-size LCD panels.
It is reported that the global LCD panel production area will increase by a significant 10.5% in 2018. The increase in production capacity will mainly come from the G8.6 and G10.5 lines, which will also increase the supply capacity of large-size panels such as 50-inch, 65-inch and 75-inch panels. As in our country, part of BOE's just-production-production line will usher in a climb this year.
On the one hand, the price is decreasing. On the other hand, the production capacity of LCD panels is still increasing. However, the market demand remains to be observed. From this situation, it is very likely that panel companies will hardly have revenue from last year's revenue.
Nanfang Daily reporter Yao Yao Nanfang Daily
3. Samsung TV shipments 40 million units is the largest in the world;
According to Xie Qinyi, General Manager of IHS Display Research, Samsung Electronics, the global leader in TV brands, has a strong intention in this year’s high-end QLED TV market, and shipments will double to 4 million units. This year, the total shipment volume will reach 40 million. Taiwan, the world's largest reelection, Taiwan's supply chain AUO (2409), innocent, MediaTek, Fortune can benefit.
Samsung Electronics Co., Ltd. released a new flagship QLED TV in 2018 in Taiwan on the 3rd. Xie Qinyi was invited to attend. After the interview, he emphasized that QIED TV panels can be produced mainly for Samsung monitors and AUO. The Samsung brand TVs adopt their own. Panel-based, AUO's second source of supply, focusing on more than 65吋, plus Continental Hisense, TCL and other first-tier TV brands also sell Quantum TV, which is expected to reach 5 million units in sales throughout the year. Up to 4 million units, the overall will be 3 million more than the other camp OLED TV.
He stressed that Samsung’s TV shipments this year are similar to last year’s shipments, but adopting medium and high-end products, including 4K TVs, are closely related to the Taiwanese supply chain. In addition to AUO of panel makers, one of the panel’s dual tigers Chuang is also one of the supply chain; In addition, the MediaTek division of the TV chip, the shipment of the backlight board is an important partner.
Xie Qinyi said: "This year, the global television market can reach 225 million units, which is about 3%, but the growth rate of large-size TVs above 55 inches is even more significant, which can reach 30% to 40%, compared with 32 inches and 42 inches. The increase is stagnant, reflecting the fact that the panel has continued to lower prices since last year, stimulating consumers to buy larger TVs with the same amount of money to drive the growth of large-size TVs."
He pointed out that taking 65 or more as an example, the global market will be 12 million units from last year, and 1600 to 2,000 units will be seen this year, becoming the main model for competing in first-class brand TVs. Converting large TVs with more than $2,000 in television Sales accounted for up to 40% of total sales, continuing to heat up.
Xie Qinyi believes that the large-scale sports events, such as the World Cup in June and the Asian Games, will prompt consumers to purchase the kinetic energy of large-size TVs. High quality, high contrast and smoothness are the three major buying priorities.
4. Micro LEDs still have many challenges to overcome;
In order to resist the influence of Korean panel makers on OLED technology and market, Taiwan LED makers are actively developing Micro LED technology. However, the manufacturing process of Micro LED is yet to be broken. Therefore, the Taiwan factory will use Mini LED as a transitional solution to meet OLED requirements. For example, Innolux will launch a new "AM miniLED" to target the automotive panel market.
OLED is the mainstream display technology. However, OLED panel patents are mostly controlled by Korean factories such as Samsung and LG. Taiwan LED factory is relatively backward in OLED technology and market layout. Micro LED technology advantage, hope to expand the panel market advantages and dominance.
However, Micro LED still has many challenges in the process to be overcome, especially in the aspect of mass transfer. Micro LED's wafer transfer yield needs to be over 99.9% to reach the output standard; therefore, how Enhancing wafer transfer yield is the biggest challenge for the development of Micro LED. It is reported that the current number of transfer can reach 2,500, and it is expected to achieve a goal of transferring 10,000 pieces at a time in 2018.
Due to the aforementioned difficulties, Taiwan's LED plants have not yet seen the mass production of related products despite the company's continuous investment in the development of Micro LED. Under the circumstances that the number of Micro LED transfer, yield, and grain size have not reached the commercial level, the Taiwanese LED factory decided to promote the so-called first "Micro LED" (also known as Mini LED).
For example, Innolux announced the use of "AM miniLED" technology for automotive panels, hoping to seize the automotive application market. Infineon Optoelectronics Development Center executive vice president Ding Jinglong said that AM miniLED can achieve the same level of OLED in automotive applications. Contrast, but also in the picture sharpness and OLED content courtesy, and there will be no OLED on-board applications can not meet the high temperature and other reliability, life and branding and other issues, with many competitive advantages.
Ding Jinglong pointed out that AM miniLED means using active matrix circuit (AcTIve Matrix, AM) formed by TFT to drive miniLED, so that it can really play its performance advantage and at the same time have a reasonable cost.
Ding Jinglong explained that if you want to compete with OLED in the sharpness of the picture, you must achieve top-level HDR. That is, Local Dimming Zones must have hundreds of zones and thousands of zones. Enough, that is, the idea of "each LED as a partition" is added to the basic concept of the Mini LED. However, if the conventional LED backlight driver circuit architecture is concerned, this concept may be caused by too many components. , And increase the cost and design difficult. In view of this, Innolux will use active matrix TFT circuit, drive AM miniLED architecture to solve the above problems.
As mentioned above, Micro LED still has many challenges to overcome. Innolux stated that before the launch of Micro LED products, the company will use the "AM miniLED" as a medium-term strategic product while the automotive market will be the commercialization of AM miniLED. The important goal is to further develop AM miniLED backlights for flexible substrates in the future to match the profiled/curved LCDs to meet the design and appearance requirements of automotive customers.
5. Suspended OLED TV mistakes Samsung's high-end TV market lags behind Sony LG
'TechWeb reported' May 3 news, according to Reuters, Samsung decided in 2015 to stop production of OLED TV may be a mistake, because of this error, it surrendered the high-end TV market to rivals Sony and LG.
In 2013, at the Consumer Electronics Show in Las Vegas, dazzling OLED TV debuted. Later that year, Samsung on the TV market for this $ 10,000 (63622 yuan) 55-inch TV Hype.
Among those promotions, one of them was a loft party held in the Hyde Park community in London. The Hyde Park community is known as the most expensive residential area in the world.
But by 2015, the company has stopped producing OLED TVs. The company claims that the market is not yet ready to accept high-cost technology. Instead, it decided to focus on developing LCD screens that are backlit. , And through the so-called quantum dot enhancement. Semiconductor nanocrystals can emit light of different colors, and can improve image quality. Televisions that use this kind of screen are called QLED TVs.
Stopping production of OLED TV seems to be a mistake
It seems that stopping producing OLED TVs seems to be a costly mistake.
As production costs have dropped significantly, OLED TVs have become the dominant technology in the high-end market. At present, high-end televisions refer to TVs that are 55 inches or more in size and priced at more than 2,500 US dollars (15,905 yuan).
Currently, Samsung is the only large TV manufacturer that does not produce OLED screens. Although the profit of its TV business is less than 3% of Samsung's total profit, Samsung's profits are mainly derived from its semiconductor and mobile phone businesses. But for it, losing it The leading position in the high-end TV market is definitely a heavy blow.
Online reviews of OLED and QLED TVs over the past few years have shown that Korean LG Electronics and Japan’s Sony OLED TVs have gained a lot of fans due to their excellent image quality.
It is worth mentioning that critics have said that OLED TVs have more realistic colors, high resolution, attractive designs and more and more reasonable prices.
However, this does not mean that Samsung's QLED TVs do not have their own supporters. Their image quality has also improved and their prices have declined, but they are not the first choice for critics.
Ross Young, chief executive of market research firm Display Supply Chain Consultants, stated: 'The dramatic increase in the share of OLED TVs in the high-end TV market is a direct result of its outstanding image quality. Samsung may be in its 2017 There was a mistake in the product strategy for the year. It should not overemphasize product design and ignore image quality.
Research firm IHS Markit's data shows that from the dollar revenue point of view, Samsung’s share of the global high-end TV market was only 18.5% last year, down from 54.7% in 2015. At the same time, Sony and LG have surpassed Samsung. Occupies 36.9% and 33% market share.
Of course, Samsung is still the world's largest TV maker. It has retained this title for 12 years. Samsung also claims to be the largest high-end TV maker. Data from market research firm GfK shows that Samsung accounts for more than 40%. Market share.
Sony and LG make more efficient production
According to informed sources, Samsung Electronics decided to base its TV business on LCD technology. The decision was made after the company heard suggestions from the company's now disbanded company strategy office.
The source said: 'The office proposed that focusing on the LCD rather than turning to unproven OLED technology would be more profitable.'
According to sources, the reason is that TV business is fighting the decline in profits. The company believes that LCD technology may be more profitable than high-cost OLED technology.
The only problem is that when Samsung makes this decision, LG is developing a more efficient manufacturing process to manufacture OLED screens.
LG said that the retail price of a mainstream LG 55-inch OLED TV has dropped from 15 million won (approximately US$14056) in 2013 to 3 million won (approximately US$2811) this year.
Samsung said that its biggest reason for not producing OLED TVs is the aging of the screen.
However, LG stated on its US website that although aging may occur on almost any display screen, it has solved this problem through technology that can prevent damage to the screen and correct short-term problems.
Profit data shows that Samsung is behind Sony and LG in high-end TV market
Last month, the impact of this fight on corporate performance became even more pronounced.
LG said on Thursday that its TV business unit profit increased by 77% in the quarter ending in March, and its profit margin reached a record 14%.
Samsung Electronics announced on Thursday that its consumer electronics division’s quarterly profit fell by 32%, and the division sold televisions and home appliances. The company said that its quarterly revenue declined compared to the same period last year, partly due to changes in the company’s The product line, stop selling some low-end and mid-priced televisions.
Sony’s television business has accumulated a loss of 800 billion yen (approximately 7.4 billion U.S. dollars) in the past 10 years, but in the fiscal year ending in March 2017, this part of its business achieved a turnaround.
In order to turn a profit, Sony reduced the number of global markets and diversified the supply chain. At the same time, it also provided OLED TVs and LCD TVs. In addition, it also abandoned the LCD joint venture established with Samsung.
Sony's strategy worked. From the dollar revenue point of view, Sony's share of the global television market last year was only 10.2%, but it ranked first in the high-end market.
John Soh, an analyst at Shinhan Investment, said that the company’s operating profit margin for the period from September to December last year reached 10.7%.
According to IHS data, Samsung’s prospects in the high-end TV market may further deteriorate. This year, 71% of sales are expected to come from OLED TVs, up from 51% last year.
According to Choong Hoon Yi, the former Samsung display engineer at OLED research institute, and former Samsung display engineer Choong Hoon Yi, it seems that Samsung has made a mistake, but it didn't seem like a mistake at the time, because Samsung thinks OLED technology is too immature. When asked whether it plans to restart the production and sales of OLED TVs, Samsung said that it will focus on QLEDs and micro LED technology to lead the high-end market.
Last month, Jonghee Han, president of Samsung TV, said: 'Our strategy has not changed.'
Some analysts said that Samsung may not fail because it can counterattack from the price side.
According to online channel data, the price of Q7F 55-inch QLED TV launched by Samsung in 2018 was initially US$ 1,900, which was lower than last year’s US$ 2,500. Meanwhile, the initial price of the LG 55-inch C7 OLED TV was 3,500 US dollars last year. This year's C8 starts at $2,500.