Korean Media: Smartphone OLED Screens to Surpass LCD for First Time, Korean Firms Rejoice!

On November 13, the Korean media outlet Chosun Ilbo published an article stating that liquid crystal displays (LCD), once dominant in smartphone screens, are rapidly declining in relevance, with organic light-emitting diode (OLED) technology increasingly filling the void. This shift is driven by smartphone manufacturers adopting OLED panels more widely in mid-tier devices to enhance display quality, while production of low-cost smartphones relying on LCD has contracted due to soaring memory prices.

This year, OLED displays are expected to capture over half of the smartphone panel market for the first time. According to market research firm Omdia, OLED’s share of the market is projected to reach 60.5% this year, surpassing LCD’s 39.5%. OLED’s market share is anticipated to rise from 46.2% in 2024 and 47.3% in 2025 to 60.5% in 2026. In contrast, LCD’s share is declining sharply—falling by more than 14 percentage points over the same period, from 53.8% to 39.5% by 2026.

Previously, OLED commanded over 90% of the total value share in smartphone panel sales due to its higher unit price, but lagged behind in shipment volume compared to the scale advantage of low-cost LCD panels. Now, however, OLED shipment volumes are also beginning to outpace those of LCD. As a result, while Chinese firms long dominant in the LCD market face growing challenges, South Korean display companies leading in high-end OLED supply are poised for new growth opportunities.

Although LCD falls short of OLED in terms of contrast ratio, its lower cost has made it the preferred choice for entry-level smartphones among Chinese manufacturers. Most panel production is currently carried out by Chinese display companies.

However, rising memory prices have forced manufacturers to cut output of low-end smartphones, leaving LCD-based businesses in the budget segment under significant strain. Data from TrendForce indicates that memory now accounts for 30% to 40% of smartphone manufacturing costs—up from 10% to 15% previously. While premium smartphones can absorb increasing component costs through higher pricing, raising prices for low-cost models risks reducing demand, while maintaining current pricing levels makes profitability difficult. IDC data shows that shipments of smartphones priced below $100 declined by approximately 60% year-on-year in the second quarter of this year.

As demand for low-end smartphones shrinks, OLED technology has gradually expanded into the mid-tier smartphone segment. Key drivers of this trend include rising consumer demand for sharper screens, growing importance of battery efficiency due to expanding AI functionalities, and declining OLED panel prices that reduce cost pressures on manufacturers.

The decline in LCD demand is expected to primarily affect Chinese display manufacturers. Chinese firms produce over 90% of global smartphone LCD panels. Total shipments are forecast to fall nearly in half—from 931.57 million units in 2023 to around 500 million units this year.

Meanwhile, South Korean companies are gaining ground in the OLED market. Combined shipments from Samsung Display and LG Display are projected to increase their share of the smartphone OLED market from 53.8% last year to 57.3% this year. At the same time, China’s share is expected to drop from 46.2% to 42.7%.

Original: toutiao.com/article/1881706149848072/

Disclaimer: The views expressed in this article are solely those of the author.