South Korea’s Samsung Electronics’ overall earnings were excellent, but the display division’s operating profit this year fell 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. It is mainly used in mobile phone and automotive applications. However, these markets have suddenly slowed down. One important reason is the iPhone X. Samsung originally estimated that it will provide 45 million for iPhone X in the first quarter. To 50 million OLED panels, but it is reported that the actual shipment of less than 20 million, some people expect the iPhone X second quarter sales will fall to 15 million.
LG Display announced last Wednesday that its first quarter operating loss was 9.8 billion won, which was the first loss in six years. This compares with a profit of 1.02 trillion won in the same period of last year. In 2017, LG Display achieved a record. Operating profit is mainly due to price increase. But now the price has fallen by 11% from three months ago.
In the financial report released by Taiwan’s AUO on Thursday, operating profit in the first quarter also fell sharply to NT$2.95 billion.
With the slowdown of the global smart phone market, LG Display and AUO are both in trouble with shipments 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.