Small Display Shipments Get Bigger
Small- and medium-sized Liquid Crystal Display (LCD) panel shipments grew in July, signaling a strong start to the beginning of the third quarter, according to iSuppli Corp.
The growth comes mostly from demand driven by OEMs and channels, which are gearing up for the holiday season.
Most panel makers reported price increases in July for many LCDs due to a pick-up in demand, coupled with shortages in key components like glass and driver ICs. The LCD glass shortage, more pronounced in the medium-panel market, is expected to improve toward the end of the third quarter. The increase in panel prices and shipments due to higher third-quarter demand will help panel makers improve profitability, which has been under pressure since the fourth quarter of 2008.
Small/medium display suppliers are planning to increase capacity utilization by 5 percent in the third quarter compared to the second quarter. The expansions are being undertaken cautiously, however, despite the increase in capacity.
Although the third quarter is the strongest period of the year for the consumer and AV markets, utilization during the period will remain at 75 percent to 80 percent levels due to glass shortages. In fact, very few suppliers are indicating a return to full 100 percent utilization levels in the third or fourth quarters, and many suppliers are planning to drop utilization rates in the fourth quarter as the market prepares for a slowdown in the first quarter of 2010. These developments will help maintain or reign in price declines in the market for the second half of 2009.
Taiwan Growth Continues
Shipments from most Taiwanese display suppliers were higher in June than in May. Overall second-quarter shipment levels for many Taiwanese display suppliers exceeded the levels from the second quarter of 2008 and the first quarter of 2009.
Strong demand for medium-sized panels—used in low-cost netbook PCs, portable DVDs and Digital Photo Frames (DPFs)—as well as the anticipated uptake in demand for Digital Still Cameras (DSCs) and mobile handsets for the holiday season will help increase shipments in the third quarter.
The growth comes mostly from demand driven by OEMs and channels, which are gearing up for the holiday season.
Most panel makers reported price increases in July for many LCDs due to a pick-up in demand, coupled with shortages in key components like glass and driver ICs. The LCD glass shortage, more pronounced in the medium-panel market, is expected to improve toward the end of the third quarter. The increase in panel prices and shipments due to higher third-quarter demand will help panel makers improve profitability, which has been under pressure since the fourth quarter of 2008.
Small/medium display suppliers are planning to increase capacity utilization by 5 percent in the third quarter compared to the second quarter. The expansions are being undertaken cautiously, however, despite the increase in capacity.
Although the third quarter is the strongest period of the year for the consumer and AV markets, utilization during the period will remain at 75 percent to 80 percent levels due to glass shortages. In fact, very few suppliers are indicating a return to full 100 percent utilization levels in the third or fourth quarters, and many suppliers are planning to drop utilization rates in the fourth quarter as the market prepares for a slowdown in the first quarter of 2010. These developments will help maintain or reign in price declines in the market for the second half of 2009.
Taiwan Growth Continues
Shipments from most Taiwanese display suppliers were higher in June than in May. Overall second-quarter shipment levels for many Taiwanese display suppliers exceeded the levels from the second quarter of 2008 and the first quarter of 2009.
Strong demand for medium-sized panels—used in low-cost netbook PCs, portable DVDs and Digital Photo Frames (DPFs)—as well as the anticipated uptake in demand for Digital Still Cameras (DSCs) and mobile handsets for the holiday season will help increase shipments in the third quarter.
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