Large-area TFT LCD shipments grow by 42pc Q/Q in Q2’09

AUSTIN, USA: Results of the DisplaySearch large-area (10" and larger) TFT LCD survey for Q2'09, as reported in its Quarterly Large-Area TFT LCD Shipment Report, indicate that shipments reached 130 million units, strong growth of 42 percent Q/Q and 10 percent Y/Y (see Table 1).

Due to the increase in prices, large-area TFT LCD revenues grew 51 percent Q/Q, but were still down 29 percent Y/Y, to $15 billion. Strong market demand in Q2’09 led to a recovery in capacity utilization across all applications.

Table 1: Q2’09 Large-Area TFT LCD Shipments by Original Specification and Application (Millions)Source: DisplaySearch Quarterly Large-Area TFT LCD Shipment Report.
* Original specification indicates the panel specification at the time of shipment. Some panels specified for LCD monitors are used for LCD TVs.
** Includes 10.x”, 11.x” and some 12.0” panels used in mini-notes (also called netbooks)

DisplaySearch also revealed details of its survey of panel makers’ shipment targets for Q3’09 through Q2’10. Panel makers are increasing capacity utilization to respond to growing demand and targeting Q3’09 shipments of large-area TFT LCD panels of 152.8 million, up 18 percent from Q2’09 (see Table 2).

If panel makers reach their unit shipment targets, revenue growth is expected to be 32 percent Q/Q.

Table 2: Large-Area TFT LCD Shipment Targets by Original Specification and Applications (Millions)Source: DisplaySearch Quarterly Large-Area TFT LCD Shipment Report.
* Original specification indicates the panel specification at the time of shipment. Some panels specified for LCD monitors are used for LCD TVs.
** Includes 10.x”, 11.x” and some 12.0” panels used in mini-notes.

In Q2’09, Samsung Electronics led in large-area TFT LCD panel revenues, with sales of $4.2 billion, a 27.8 percent revenue share, according to DisplaySearch findings. LG Display was second, with $3.7 billion in revenues and a 25 percent sales share. AUO was third at $2.3 billion with a 15.7 percent share, with CMO closely behind at 15.3 percent share.

In Q2’09, LG Display took first place in unit shipments, but Samsung shipped the most by area. On a unit basis, Korea was the largest supplier of large-area TFT LCD panels in Q2’09 with a 49.8 percent share, but was down from 52.2 percent in Q1’09 due to strong shipment growth of Taiwanese panel suppliers.

Taiwan’s share increased from 38.4 percent in Q1’09 to 41.2 percent in Q2’09.

Table 3 shows the Q2’09 shipment ranking of large-area TFT LCD panels by original specification and application.

Table 3: Top Three Unit Suppliers for Each Application in Q2’09
Source: DisplaySearch
* Includes <26” LCD monitor panels used for LCD TV
** Includes 10.x”, 11.x” and some 12.0” panels used in mini-notes
*** Excludes <26” LCD monitor panels used in LCD TVs

According to David Hsieh, Vice President of DisplaySearch, “We are forecasting that industry utilization will be 87 percent in Q3’09 due to growing orders. In Q2’09 the industry experienced a strong recovery, and shipments reached record highs.

"We expect that strong demand will push panel shipments to another record high in Q3’09. However, strong panel shipments in some cases are due to downstream players piling up inventory, so we believe it will be necessary to watch the supply chain inventory situation closely at the end of Q3’09.”

Top five makers to produce 89.2pc of global large-area TFT LCDs by area in 2009

AUSTIN, USA: Production of TFT LCD panels is continuously evolving, as different panels of different sizes and applications are made on the most appropriate generation fabs based on utilization and cost efficiency.

In unit terms, 34.3 percent of large-area (10”+) TFT LCD panels were made on Gen 7 lines in Q1’09, up from 32.5 percent in Q4’08, according to the latest DisplaySearch Quarterly Large-Area Production Strategy Report. DisplaySearch defines Gen 7 to include 1870 × 2200 mm and 1950 × 2250 mm (defined by some as Gen 7.5) substrate sizes.

In Q1’09, 2.3 percent of all panels were produced on Gen 4 and below, 24.4 percent on Gen 5, 4.4 percent on Gen 5.5, 23.9 percent on Gen 6, 34.3 percent on Gen 7, and 10.8 percent on Gen 8, in unit terms (see Table 1).

TFT LCD makers are shifting more production to larger fabs. In Q1’10, the share of large-area TFT LCD panels produced on Gen 8 lines (which DisplaySearch defines to include 2160 × 2460 mm and 2200 × 2500 mm sizes) will increase to 19.4 percent, and 2.8 percent will be produced on Gen 10 lines.

Table 1: Large Area TFT LCD Production Unit Share by Fab GenerationSource: DisplaySearch Quarterly Large-Area Production Strategy Report

By application in Q1’09, 77.6 percent of mini-note PC (netbook) panels and 82.8 percent of notebook PC panels were made on Gen 5 lines. Since Gen 5 glass substrates are in shortage, the supply of notebook PC panels is expected to be tight in the next few months. About 3.4 percent of notebook panels were made in Gen 6, mainly by LG Display and CPT.

In Q1’09, 43.2 percent of monitor panels were made on Gen 5 lines, the first time Gen 5 production of monitor panels fell below 50 percent. DisplaySearch forecasts that in Q4’09, 55.7 percent of LCD monitor panels will be made in Gen 6 and larger fabs. Interestingly, 4.4 percent of LCD monitor panels were made on Gen 8 lines in Q1’09, solely due to Samsung 18.5”W and 21.5”W monitor panels.

In terms of TV, Gen 7 has a 47.7 percent share of TV panels; 29.8 percent were made on Gen 6 lines and 16.4 percent on Gen 8. In Q4’09, DisplaySearch forecasts that 28.4 percent of TV panels will be made on Gen 8 lines, compared to 23.3 percent on Gen 6.

The DisplaySearch Quarterly Large-Area Production Strategy Report discloses TFT LCD suppliers’ production plans, by size, application and generation. The top five TFT LCD makers are expected to account for 89.2 percent of panel production by area in 2009, a big leap from the 74.8 percent in 2008.

In total, TFT LCD makers are planning to input 105 million square meters of glass substrate for large-area panels in 2009, which represents 15.5 percent growth from the 90.9 million square meters in 2008.

Samsung is expected to lead TFT LCD production with 28.9 million square meters input in 2009, or 27.5 percent of the total, followed by LG Display at 25 million square meters, or 23.8 percent share. AUO is expected to rank third with 17 million square meters and 16.2 percent share, followed by CMO at 16.8 million square meters and 16 percent share, and Sharp will be fifth with 6 million square meters input and 5.7 percent share.

“DisplaySearch expects that TFT LCD production will experience another new wave of changes as Gen 8 production is increasing, and Gen 10 is expected to come on line by Q4’09. Production of smaller size panels in large fabs will increase, as it enables flexibility, and this will change the product mix,” said David Hsieh, vice president of DisplaySearch and leader of large-area TFT LCD research.

Hsieh continued: “Many monitor and TV panels are produced on the same generation lines, so when TV panels are in shortage, the monitor panel market becomes tight as well. On the other hand, the high production share of the top five large-area TFT LCD panel suppliers indicates that the large-area TFT LCD market is moving to new level of concentration.”