LG Display Reports Profit From OLED TV Panels In Q3
LG Display revealed in its third quarter financial statement Tuesday that its OLED TV panel business “has finally turned to profit” after five years of growth.
The unit of South Korea’s LG conglomerate that supplies sister company LG Electronics and other manufacturers with LCD and OLED panels, said sales volume of OLED TV panels increased to over 1.7 million panels in 2017, a jump from only 200,000 in 2013, driven by successful global sales.
The LG Display unit has absorbed most of the losses from the OLED TV business, with LG Electronics profiting from strong growth with the high-price, high-end OLED TV business. In addition, in recent years LG Display has started to sell OLED TV panels to other manufacturers like Sony, Bang & Olufsen, Panasonic and other brands distributed in Western Europe and other regions outside of the United States.
LG Display posted an operating profit of 140 billion won ($123.2 million) for the July-September quarter, after two quarters of consecutive losses, helped by higher seasonal panel prices.
LG Display attributed revenue performance to an increase in LCD panel prices and the company’s focus on differentiated products such as OLED TV panels and high-end IT products, as well as by favorable foreign exchange rate movement.
“LG Display has been pioneering the large-size OLED TV panel market since January 2013 when it became the first in the world to start mass production of OLED TV panels,” the company said in its statement. “From then on, the company has diversified its customer base through continually introducing cutting-edge, innovative products such as Wallpaper OLED TV panels and Crystal Sound OLED (CSO) panels.”
LG Display said panels for TVs accounted for 41% of the revenue in the third quarter of 2018, mobile devices for 21%, tablets and notebook PCs for 20%, and desktop monitors for 18%.
“Panel area shipments in the fourth quarter are expected to increase by a low to mid-single digit percentage due to the seasonality effect. Panel price trends are expected to vary by product size and segment,” said Don Kim, CFO of LG Display.
Kim said the LCD market is expected to see double-digit growth in supply, but on the demand side market volatility continues to grow as a result of uncertainties generated by tariffs, trade frictions and foreign-exchange risks.
He added, “2018 and 2019 are critical years for LG Display as it transforms into a more OLED-focused business structure. We will do our best to maximize profitability by expanding our OLED business portfolio while accelerating our pursuit of a differentiated strategy for our LCD business.”
By Greg Tarr
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