The gist of it: at Display Week 2023 there was talk of the opportunity for OLED displays for IT products in the absence of demand for TV panels. If the IT products segment (PCs, laptops, and notebooks) is to drive growth for OLED panel makers, with TV panel manufacturing shrinking its capacity, it may need a more vibrant customer base. IT buying is the lowest common denominator of PC sales, not conforming to any view you might have of an early adopter, or premium purchaser; that’s what it takes to get those IT product OLED panel sales up.
And, if you just look at the data flowing in from analysts, all analysts, the PC market has a long, long way to go to recovery with many reasons to believe that it has left its best years behind.
Slumping PC Sales Worldwide
There was some interesting social media chatter about a session by Ross Young of DSCC at Display Week 2023’s business conference. According to Young, the display industry is currently in a phase of contraction and cost control, but is laying the groundwork for future growth, particularly in the OLED IT segment. However, this rebound will depend on market conditions and the success of the new OLED factories planned by major players like Samsung and LG Display.
Display manufacturers are currently facing sluggish demand which is leading to the closure of factories and low utilization rates across the industry. A total of nine factories have been shut down in the last 18 months, some of which may be temporary closures. Six more factories, accounting for 8.4% of the total market, are at risk of closure in the coming year. Additionally, a significant number of factories reported utilization rates of less than 60% in Q4’22, suggesting potential loss of over 11% capacity, according to Young.
I want to juxtapose that information against just two data points, first, the India PC market which, according to IDC, saw drops in sales, some significant shortfalls, across the board.
This is pretty much the picture across the board for all analysts’ expectations. Canalys has a report on the Chinese PC market, and with the exception of my personal favorite growth engine, Huawei, everything less looks dire.
The ones to look out for are Lenovo, Dell, and HP, with probably the best brand recognition worldwide. Apple, which could be a big factor in OLED IT product sales doesn’t factor into the equation at this point. Apple will move into its own display industry category, alone. It has done the same in CPUs. It is the big worldwide brands that have the best overview of the market, and they are taking a beating. They can adjust because of the range of markets and products, but they would be hard pressed to become advocates of next-generation displays. It’s best to look at the games PC lineup of these companies, and see how that evolves. That’s where the specs get pushed, and that’s where the early adopters are going to be. Are they OLED display buyers? Too hard to tell. The PC games industry is going to face its own challenges over the coming years; the Nvidias of this world will still deliver gaming products but that’s not where their future lies. For the PC business it is going to be the cloud and AI, whatever that means.
