Total revenue in the fourth quarter of 2022 was $169.0 million as compared to $146.2 million in the fourth quarter of 2021. Revenue from material sales was $88.3 million in the fourth quarter of 2022 as compared to $85.8 million in the fourth quarter of 2021. This increase was primarily the result of higher unit volume.
“We ended 2022 strongly with record revenues and earnings,” said Brian Millard, Vice President and Chief Financial Officer of Universal Display Corporation. “As we look to 2023, while macro uncertainties persist, we are continuing to build upon our leadership position in the OLED ecosystem. This includes continued discovery and development of next-generation phosphorescent materials, progress on the development of our commercial phosphorescent blue and groundbreaking OVJP (organic vapor jet printing) manufacturing platform, as well as investing in our infrastructure and capabilities. We believe that these initiatives and the industry’s advancing roadmap for medium- and large-area OLED displays are setting the stage for 2024 to be a pivotal year for the commencement of a new OLED adoption cycle and investment wave.”
Revenue Comparison
| (in thousands of $) | Q4 2022 | Q4 2021 |
| Material sales | $88,339 | $85,768 |
| Royalty and license fees | $75,585 | $55,995 |
| Contract research services | $5,108 | $4,484 |
| Total revenue | $169,032 | $146,247 |
| Gross margin as a % of material sales | 70% | 66% |
Financial Highlights for the Full Year 2022
- Total revenue for the full year 2022 was $616.6 million as compared to $553.5 million for the full year 2021. We continue to expect the near-term weakness in the overall global market economy to have an impact on forecasted demand for OLED products utilizing our emitter material over the remaining life of certain customers’ contracts compared to prior estimates, resulting in us recording a positive cumulative catch-up adjustment to total revenue during the full year 2022 of $30.3 million arising from changes in estimates of transaction price.
- Revenue from material sales was $331.1 million for the full year 2022 as compared to $318.6 million for the full year 2021. This increase was primarily the result of higher unit volume.
- Revenue from royalty and license fees was $267.1 million for the full year 2022 as compared to $219.0 million for the full year 2021. The increase was primarily due to the cumulative catch-up adjustment as well as higher unit material volume.
- Cost of material sales was $115.6 million for the full year 2022 as compared to $104.4 million for the full year 2021. The increase was due to higher unit material volumes as well as underutilization costs associated with our Shannon facility in the full year 2022 of $7.9 million.
- Total gross margin was 79% for both the full years 2022 and 2021.
- Operating income was $267.1 million for the full year 2022 as compared to $227.6 million for the full year 2021.
- Net income was $210.1 million or $4.40 per diluted share for the full year 2022 as compared to $184.2 million or $3.87 per diluted share for the full year 2021.
Revenue Comparison
| (in thousands of $) | FY 2022 | FY 2021 |
| Material sales | $331,081 | $318,623 |
| Royalty and license fees | $267,115 | $219,032 |
| Contract research services | $18,423 | $15,870 |
| Total revenue | $616,619 | $553,525 |
| Gross margin as a % of material sales | 65% | 67% |
2023 Guidance
The Company believes that its 2023 revenue will be the range of $550 million to $600 million. The OLED industry remains at a stage where many variables can have a material impact on results, and the Company thus caveats its financial guidance accordingly.
