LCD TV Panels Enjoyed Record Quarter in Q2'07, Doubled Up on PDPs at 40"+ as Plasma Sales Remained Weak

DisplaySearch Reports LCD TV Panels Enjoyed Record Quarter in Q2'07, Doubled Up on PDPs at 40"+ as Plasma Sales Remained Weak

AUSTIN, TEXAS, July 31, 2007-DisplaySearch, the worldwide leader in flat panel display market research and consulting, reported in its latest Quarterly PDP Module and TV Shipment and Forecast ReportandWeekly TV Flash Report that plasma and LCD TV panel sales were headed in opposite directions in Q2'07.

LCD TV panel shipments enjoyed a record quarter in Q2'07, rising 32% Q/Q and 65% Y/Y to 19.6M panels.  The Q2'07 results exceeded suppliers' expectations and DisplaySearch's forecast by over 700K panels or 4%. Revenues grew 28% Q/Q and 39% Y/Y to a record $7.2B.  ASPs were only down 2% Q/Q and 16% Y/Y to $369. For the first time, twice as many 40"+ LCD TV panels were shipped as 40"+ plasma panels, as shown in Figure 1. The LCD TV share of the 40"+ flat panel market rose from 42% in Q2'06 to 68% in Q2'07. This can be attributed to the amount of optimized Gen 7 and larger LCD fab capacity brought online, to the success of LCD TV brands and retailers in getting consumers excited over 1080p TVs where LCDs have dominated PDPs and to the greater number of LCD TV brands overwhelming plasma TV brands in retail.

Figure 1: 40"+ LCD TV and Plasma TV Panel Shipment Results

Of the total LCD TV panel shipments, the 40"+ share rose from 22% in Q1'07 to 23% in Q2'07 and the 1080p share of all LCD TV panel shipments rose from 10% to 11%. Not all larger sized categories increased share in Q2'07; the 45-47" category fell from 5.0% to 4.7% as prices remained too high for most consumers. 32" remained the dominant size category, earning a 38% share with OEMs and brands likely buying more 32" panels than they needed as 32" panel prices have been rising. LPL remained #1 on a unit basis followed by AUO and Samsung. On a revenue basis, Samsung remained #1 followed by LPL and AUO.

Plasma panel shipments were flat Q/Q and down 4% Y/Y to 2.3M panels. Year to date, plasma panel shipments are down 3% despite a 51% increase in capacity. Plasma panel manufacturers were expecting an increase of 18% to 2.7M panels, so clearly Q2'07 was disappointing. With plasma panel prices falling rapidly, plasma panel revenues were down 13% Q/Q and 37% Y/Y to $1.2B.  ASPs were down 13% Q/Q and 34% Y/Y to $507.

Despite the overall PDP decline, there was growth at 50"+ and rapid growth in 1080p panels. The 50"+ share of PDP panel shipments continued to increase, rising from 29% in Q1'07 to 31% in Q2'07 on an 8% Q/Q increase and is expected to reach a 34% share in Q3'07 as PDP suppliers continue to shift their focus to larger sizes due to 42" share losses to LCDs.  There was also a dramatic increase in 1080p panel shipments, up 545% to 169K panels with 1080p penetration rising from 1.1% to 7.3%.  The increase in 1080p shipments and improved supply should improve their competitive position against LCDs.

Matsushita remained #1 with Samsung SDI overtaking LGE for #2 as shown in Table 1. Of the five major suppliers, only Matsushita and Samsung SDI enjoyed Y/Y growth. By size, Matsushita led at 37", 42", 55-59" and 60"+ while Samsung SDI led at 50". 1080p panels accounted for an impressive 17% of Matsushita's mix, up from just 2% in Q1'07.

Table 1:       Plasma Panel Share and Growth by Supplier

Looking forward, PDP suppliers are expecting over a 30% Q/Q increase to over 3M panels in Q3'07. In order for this to happen, we would expect to see PDP TV brands make significant price moves within the next 60 days.

DisplaySearch, an NPD Group company, has a core team of 46 employees located in Europe, North America and Asia who produce a valued suite of FPD-related market forecasts, technology assessments, surveys, studies and analyses. The company also organizes influential events worldwide. Headquartered in Austin, Texas, DisplaySearch has regional operations in Chicago, Houston, Kyoto, London, San Diego, San Jose, Seoul, Shenzhen, Taipei and Tokyo, and the company is on the web at www.displaysearch.com.