Universal Display Corporation (UDC) - Page 15

In March 2014, Universal Display announced they signed an evaluation agreement with China's BOE Display. Yesterday UDC announced that it signed an expanded evaluation agreement with BOE. UDC will broaden its collaboration with BOE and supply additional phosphorescent OLED (PHOLED) materials for display applications.

BOE Technology Chairman, Wang Dongsheng, says that the company hopes to push forward OLED development together with UDC and other partners. BOE has a Gen-8.5 pilot fab in Hefei in which they produced the 55" 4K OLED TV sample shown last month. Hopefully this pilot line will be the precursor of a real Gen-8.5 AMOLED fab.

Universal Display report several OLED technology advances at DisplayWeek. First up, the company is showing several advances in OLED lighting. UDC is presenting a new approach to make white OLEDs. The panels are based on RGB stripes, each controlled with a separate current driver. UDC says that this approach potentially improves the OLED panel performance, manufacturing yield, brightness uniformity and color-tunability.

UDC calls this new architecture "RGB monochrome striped", and they demonstrate a 15x15 cm color-tunable white OLED that features an effifacy of 63 lm/W and a color temperature of 3000K. UDC is also showing a 100 lm/W all-phosphorescent warm white OLED with a lifetime (LT70) of 60,000 hours at 1,000 cd/m². Finally, UDC is also showing a remarkable high R9 warm white WOLED with CRI of 96.

Following is a sponsored post from Smithers Apex:

Smithers Apex (with the OLED Association) announced the agenda and lineup for the OLEDs World Summit 2014 conference. LG Display, Novaled, BASF, Acuity Brands Lighting, Konica Minolta, DuPont Displays, Panasonic, Visionox, BOE, Philips Lighting and many more of the industry’s most influential players in OLED lighting and displays will be presenting at the event.

The 16th annual event will take place September 16-18 at the Claremont Hotel Club & Spa in Berkeley, CA. Smithers Apex says that the OLEDs World Summit is the longest-running, preeminent business development and technical event dedicated exclusively to the OLEDs industry - connecting researchers with customers and manufacturers in both the lighting and display sectors.

Universal Display participated in Cowen and Company's 42nd Annual Technology, Media & Telecom Conference. This was a very interested talk - and I recommend listening to it if you're an investor (or interested in investing) in UDC. Here I give some of the updates and highlights from that talk.

In Q1 2014, UDC Introduced a new high performing red emitters for mobile applications. That red emitter is longer lasting, provide a better gamut and is also more efficient. UDC more or less confirmed that the GS5 uses these new materials and that's how Samsung managed to improve the efficiency by 25% compared to the GS4 display. Because these are new materials, SDC go back to the original prices (before accumulative volume discounts).

Universal Display reported their financial results for Q1 2014 - and the company had another great quarter. Revenues were $37.8 million (compared to $15 million in Q1 2013) and net income was $4.0 million. This does not include Samsung's license fees which will be $50 million in 2014, and will be paid in Q2 and Q4.

Green emitter sales were $17.2 million (up from $11.6 in Q4 2013, and 4.6 a year ago). Green host sales were $12.4 million (up from $9.3 million in Q4 2013 and 3.1 a year ago). Red emitter sales were $3.9 million (up from $2.8 million in Q4 2013 and Q1 2013). UDC now expects 2014 revenues to reach the high end of its $190 million to $205 million guidance range.

Samsung's Cheil Industries says that they will start supplying Samsung Display with phosphorescent green host for their OLED displays. Cheil developed the new material for the past two years and says that it will improve the OLED panel brightness and power consumption compared to the current material Samsung uses (made by UDC). It is also reportedly cheaper.

According to the report, some industry source say that this new material may have been used in Samsung Electronics' GS5 phone - as indeed we know the new display is brighter and more efficient than Samsung's previous display. On the other hand if this is true, than Cheil should have started ramping up production months ago. Cheil will produce 5 tons of this new material in a year.

DisplaySearch says that the OLED industry's material growth is going to be lower than expected due to high manufacturing cost, delays in OLED TV and "very few breakthroughs in AMOLED displays". DisplaySearch now estimates the total material market in 2014 to reach $795 million (previously they estimated it to reach over $1 billion).

According to DisplaySearch, in 2014 the material market will grow 77% and in 2015 it will again grow by 70%. Growth will be much slower in 2016 and 2017. Interestingly, in 2014 the green emitter and host materials (EML) will grow by 228%. I think the reasoning is that Samsung will convert more lines to PHOLED greens (which cost more than fluorescent green). This is good news for Universal Display. In addition, it seems that blue EML costs will not grow much which probably means DisplaySearch is not seeing blue PHOLED adoption at all.

The European Patent Office (EPO) ruled to upheld one of Universal Display's key PHOLED patents (EPO#EP1394870). This patent, which UDC refers to as EP870, details an OLED in which the emissive layer contains phosphorescent dopant compounds. This patent corresponds to the company's US'238 patent.

In November 2013, the Japanese High Court decided to validate UDC's claims in Japanese patent #4511024, which is a counterpart patent to the EP870 and US238 patents. Later in November, The EPO revoked one of UDC's basic phosphorescent OLED patents, EPO#1449238. The opposing parties included Sumitomo Chemical, Merck and BASF.

Universal Display Corporation (UDC) is one of the most known OLED company, involved with OLED IP, OLED phopshorescent materials, innovations on flexible OLEDs, production processes and more. As the most prominent public OLED company, the company is interesting to many investors and analysts.

Last year UDC hired Darice Liu to handle communications and investor relations. Darice was kind enough to answer a few questions I had regarding UDC's technology and business. These are interesting times for UDC as the OLED market is growing quickly, OLED TVs and flexible OLEDs are finally appearing on the market, but on the other hand the company is being faced with patent litigation and criticism from some investors (whom I shall not name).

A couple of days ago we reported that according to tests by DisplayMate, SDC's new 5.1" FHD Super AMOLED panel (used in the GS5) is a lot more efficient than Samsung's previous generation panels (a 27% compared to the GS4 which is actually a little smaller). DisplayMate's Raymond Soneira told us that Samsung said that the improvement mostly came from more efficient OLED materials.

This is quite interesting, and according to my own checks, it seems that indeed Samsung is using new materials. In fact, my sources say that Samsung adoped new and improved phosphorescent materials.