| Value of Market for Hinges Used in Foldable OLED Smartphones Will Surpass US$500 Million for 2023; KH Vatech and Amphenol Are Main Suppliers | In its report on the OLED market, TrendForce predicts foldable smartphones are projected to climb from around 12.8 million units for 2022 to around 18.5 million units for 2023. The value of the global market for hinges used in foldable OLED smartphones will rise by 14.6% YoY to above the level of US$500 million for 2023. |
| Demand for Display Driver ICs Will Rise over Quarters in 2023 as Panel Industry Recovers from Slump | According to TrendForce’s analysis of the supply chain for display panels, demand slowed dramatically in 2Q22 and thereby caused inventory level to rise sharply for display driver ICs (DDIs) within a short period. However, the market for DDIs is in a notably better state now in 1Q23 following two to three quarters of price decline, reduction in wafer input, and inventory consumption. Moreover, the first quarter is the critical period when DDI suppliers set their wafer input quantities. In order to effectively meet the demand for 2H23, DDI suppliers will need to finish arranging orders with their foundry partners by the end of 1Q23. Regarding the whole 2023, the general outlook on geopolitics and the global economy is still rather pessimistic. |
| Shipments of TV Panels Are Projected to Drop by 2.8% YoY for 2023 as Sluggish Economy Affects TV Sales | The ongoing Russia-Ukraine military conflict and high inflation will continue to affect the global economy and politics during 2023. The recent decline of the global economy, in particular, has significantly dampened the outlook on sales of whole TV sets since the performance of the TV market primarily depends on consumer demand. Therefore, TrendForce projects that shipments of TV panels will fall by 2.8% YoY to a total of 264 million pieces for 2023. |
It seems to make sense to put the last three TrendForce comments on market conditions in together because the sum of the parts is a good indication of the general state of the display industry in 2023. First of all, whether it is TVs or smartphones, consumer sentiment weighs heavy on the possible outcomes. This is not unusual during recessionary periods or downturns when businesses are transparent about their austerity measures, and everyone kind of looks forlornly at the consumer.
If the worst of expectations is met this year, consumers are going to be hurting. But not the ones who are the customers for foldable displays. You can assume that there will be thirst for the next shiny bright object, whether it be high-end TVs or foldable phones, but that’s not where the volume is going to be so, it’s good for those SKUs, but not an indication of real market health. If 20 million foldable phones are sold this year that’s just 1% of the total number of units, new and refurbished that consumers will be picking up.
Finally, in the chart below, the (E) for 2021 should stand for euphoria, as in post-pandemic euphoria. 2022 was the first full post-pandemic year and everyone got a little over-excited. Judging by the numbers, global TV panel shipments have been on a slight downward trajectory for a while, and that may be because there hasn’t been a compelling upgrade cycle. I would be cautious about 2023 for one very simple reason, streaming content should be driving consumer sentiment on TV purchases and streaming is about to go through a period of consolidation and some angst.
So, now you have the perfect storm scenario: no one really knows what consumers will do in the second half of 2023, the whole issue of inventories is going to be a cat and mouse game between manufacturers as they try and maximize their own subjective measures of production, which leads to fluctuations in pricing that remain to be seen. Some vendors will go conservative, take the hit on volume, and maintain pricing, and some will go for market share, drop prices, take a hit on profits, and hope to outmaneuver the competition during the period of uncertainty. It’s like playing chicken with fate. Either way, none of that indicates a growth market or a rebound or warm fuzzy feelings.
