LG Display reported their financial results for Q2 2014, with a 7% increase in revenue over Q1 2014 (but a 9% decline from Q2 2013) and a net profit of $250 million (up from a loss in Q1 and a profit of $100 million in Q2 2013). But of course I'm more interested in LG's future OLED development efforts.
In their press release, LGD says that they will "continue to make efforts to generate mid- and long-term profits by building on its OLED TV leadership... and further developing differentiated small and mid-size products including plastic OLEDs".
Last month there was a somewhat confusing report saying that LGD plans to invest a further $788 million on new OLED TV production lines that will expand capacity to 34,000 substrates (The M2 fab has a capacity of 26,000). Now, during the conference call, I finally understand that that report was not true. LG says that when the M2 fab comes online (still expected in Q4 2014) the total capacity will indeed by 34,000, as currently they make 8,000 substrates a month (in the pilot line).
So the 34,000 a month figure comes from combining the two lines (pilot + M2). As I understand it, there is not further investment planned. Perhaps LG's original $650 million plan was too optimistic and now they estimate it at $788 million.
Regarding flexible OLEDs, LG Display currently makes 6,000 4.5-Gen substrates each month. In the conference call, LG updated that they expect to double that in the second half of 2014. In addition, they are thinking about a Gen-6 facility for flexible displays, but it has not been decided yet. This depends on market demand and customers.
Regardless of these cautionary statements, LG seems to be very confident on OLEDs. In a statement to the Financial Times, LG's OLED TV division VP said that "LCD has no future" as LG cannot compete with Chinese makers that can make high-quality UHD LCDs at lower costs. LG understands that if they want to survive, they have to make products that the low-cost Chinese makers cannot produce.
Comments
Yes, this is a Gen-8 pilot line, so samze-sized substrate. Sometimes you cannot simply upgrade a pilot line, and it's easier to build a new one. It's likely that LGD will also want to keep this line as an R&D line as well.
So pilot line is same size substrate as M2 line? Why LG not upgrade pilot line instead of building new factory, does not make sense.