OLED is FPD’s Only Bright Spot

Amidst falling TFT-LCD revenues, OLED is the only display technology with an expected revenue increase, says IHS.

Revenues for the overall flat panel display (FPD) industry are expected to fall 2% YoY in 2015, from $131.4 billion to $129 billion. As well as falling TFT-LCD revenues, the industry is also being affected by declining PC panel demand and continued panel-price erosion.

Following growth in 2014, TFT-LCD revenues will fall 3% in 2015, says IHS; from $120 billion to $115.8 billion. However, a return to growth is predicted in 2016, when revenues will rise just over 1% to $117.4 billion (see below). Other display technologies – including ePaper, CRT, plasma and PM-LCD, are also facing declines; some because the technology is obsolete, others because of a lack of new applications.

Last year, TFT-LCD display revenues rose 5% YoY, mainly due to strong LCD TV panel shipments and higher panel prices. IHS predicts a decline this year due to falling demand for tablet, notebook and desktop monitor panels; price erosion of smartphone panels, due to sharp increases in LTPS TFT-LCD production; and falling open-cell LCD TV panel prices.

Despite falling revenues, IHS is predicting almost 4% growth in area demand: from 165.5 million m² to 172 million m². This indicates that the revenue decline is being driven by falling ASPs.

David Hsieh, an analyst with IHS, advised, “The entire FPD supply chain now must shift focus from growth to cost reduction, in order to maintain profitability”.

AMOLED display revenues will reach $11.8 billion this year; up 36% YoY. PMOLED revenues are expected to climb 22%, to $450 million. This growth is based on several factors, such as rapidly-rising smartphone display shipments; growth in OLED TV panel shipments; and the use of AMOLED displays in new products, such as tablets and wearables.

IHS says that further expansion of LCD TV features (larger sizes, wider colour gamuts, UltraHD penetration, etc.) will be responsible for the future growth of TFT-LCD revenues. These features will push ASPs to keep rising. The emergence of UltraHD displays for new products, such as tablets and desktop monitors, will further increase ASPs. New applications such as new automotive displays, smartwatches and so on will also add to revenue growth.