Global revenue from shipments of large-sized LCD panels is set to decline to $17.3 billion in the first quarter of 2010, down only 5.1 percent from $18.2 billion in the fourth quarter of 2009.
In contrast, revenue declined by 14.9 percent sequentially in the first quarter of 2009 and by 9.1 percent during the fourth quarter of 2008.
The market in the first quarter posted impressive growth compared to the same period in 2009. Revenue rose by 66 percent from $10.4 billion in the first quarter of 2009.
The attached figure presents iSuppli’s quarterly estimate and forecast of global large-sized LCD panel market revenue in 2009 and 2010. iSuppli defines large-sized LCD panels as those having a diagonal dimension of 10 inches or more.
“The first quarter is typically a slow season for the global large-sized LCD market following the annual peak in shipments during fourth-quarter holiday season,” said Sweta Dash, senior director, LCD research at iSuppli.
“However, in the first quarter of 2010, television and computer brands—along with system integrators—have been replenishing large-sized LCD panel stockpiles that had been depleted during the peak holiday selling season. The inventory-building effort is expected to cause pricing to rise during every month of the first quarter of 2010. This will keep market revenue in the first quarter of 2010 from declining as much as in previous years.”
Average panel pricing in February will rise by $2 to $3 for monitors, by $1 to $2 for notebooks and by $2 to $3 for televisions. If February pricing follows iSuppli’s forecasts, this will represent the second month in a row that all major applications for large-sized LCDs have seen an increase in panel pricing.
In January, overall LCD panel pricing increased by 2 percent, also due to inventory replenishment and tight panel supply. Television panel pricing rose by 0.3 percent for the month.
TV panel softness ahead?
In the second quarter, iSuppli expects television panel pricing to remain flat or to show some softness.
“On the demand side, pricing softness will be the result of slowing sales as North American brands finish their new-model launch preparations and China’s Labor Day holiday season ends,” Dash said. “On the supply side, LG Display’s 7.5-generation panel fab and Samsung LCD’s 7.1-generation facility will be fully depreciated by the second quarter. This will allow both companies to reduce cost and improve profitability more than other suppliers.”
At the same time, limited capacity increases for television panels in the second half of 2010 will help stabilize panel pricing and prevent further declines.
In the near term, television panel pricing is expected also to bear the fruits of the February price increases because of the Chinese Lunar New Year holiday and fear of lower panel production levels.
However, demand for television panels remains healthy from the Chinese and US markets. With shipments expected to grow in the double digits in March, panel prices will rise slightly again for the month.
Source: iSuppli, USA.
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