Surging Demand for OLED TVs Presents Trillion-Dollar Opportunities

The demand for OLED TV panels has experienced a significant surge since February 2023, leading to increased production rates and garnering attention from industry experts. This trend has impacted major players like LG Display (LGD) and Samsung Display (SDC).

According to market research firm Omdia, as of the end of February 2023, LGD's supply of large-size OLED panels reached 280,000 units, marking a monthly increase of 69.2%. Although this number falls short of the peak in 2022 (800,000 units), it signals a rebound in demand for large-size OLED panels, considering the supply had temporarily decreased to around 100,000 units at the beginning of 2023.

The fluctuation in demand for large-size OLED panels naturally affects LGD's production rates. In the fourth quarter of 2022 to the first quarter of 2023, LGD's production rates dropped to around 50%. However, industry sources indicate that LGD's panel orders have gradually recovered since February 2023, with current production rates surpassing 70%. There is hope for further improvement in production rates in the second half of 2023.

Of note is the speculation surrounding renewed OLED TV panel negotiations between LGD and Samsung Electronics. While the talks in the second half of 2022 had stalled, there are rumors of a potential agreement between the two companies as Samsung Electronics enters the OLED TV market in 2023. If an agreement is reached, Samsung Electronics could release OLED TV products featuring LGD's panels as early as the second half of 2023 or, at the latest, by the second half of 2024.

SDC is also increasing its supply of large-size OLED panels, aiming to expand its influence in the OLED market. Currently, SDC's average monthly shipments of TV panels range from 60,000 to 70,000 units, representing an increase of over 20% compared to early 2023. Some experts believe that recent advancements in QD-OLED panel yield, surpassing 90%, have successfully reduced production costs and increased supply flexibility.

Earlier predictions by DSCC suggested a 2% decrease in the shipment of high-end TVs, including OLED TVs, in 2023 compared to 2022. However, the recent resurgence in demand for OLED TV panels indicates a gradual recovery in the second quarter of 2023 for high-end TVs. Electronic components distributors should closely monitor these developments as they present significant opportunities in the trillion-dollar OLED TV market.