What now for OLED? Universal did very well last quarter but whats next. I belive its all about square inches. Why? Because the average smartphone screen is about 7 square inches. OLED sells product to fill those inches. And the dude at Piper was mistaken in his projections for OLED by basing it solely on Samsung G4 sales. Samsaung and Samsung screen customers have many models that use Amoled screens. But selling 7 square inches of material does not merit the high PE OLED enjoys. What can justify such a high PE? 1300 square inches. That is what a 55 inch TV has and that is a whopping 190% increase in material sales. Samsung annouced price drop of over 30% on its oled tv's indicate they may have achieved commersial production quality sooner than the market expected. The next very large maker to see is LG entering a contract that is simmilar to Samsung as that would indicate they are producing commersial quantities of curved oled TV's. When that happens, that will mean a near additional increase of 190% in material sales. And that is why the PE is so high.
one thing to observe is that oled's penetration within SMD cellphones has been steadily growing but still far off from replacing all their displays produced...that said if 1 million tv's = 100 million cellphones for oled area.... there are about 20 million tv's per year ? if oled hits even 10% of that market its the size of the whole cellphone market so far for oled. full penetration of oled tv is the same area as 2 billion cellphones sold... mind boggling :)
Yes oled tv uses way more area but don't ignore the expansion of non-tv oled capacity as these capacity ramps within SMD and soon in others are very significant and can justify the help justify p/e without oled tv. Even display searches oled growth estimates out to 2020 still has small displays in the drivers seat. Ruling out small display growth as the main driver is folly. OLED TV area is fantastic and amazing but comparing the number of oled tv's produced to the hundreds of millions of small displays must be approached cautiously.
use 15 instead of 7... and 1400 instead of 1300 to be more in line with smd products. (GS4, OLED TV) 93: 1 is still staggering but..you need to sell 1 million oled tvs for every 100 million GS4's to even match small display production. That said LG's goal of 180k tv/month would hit your 1 million mark. Still a very big deal but its a race between tv and small display growth in terms of which one wins total oled capacity significance. they are both very significant. OLED TV is a very welcome addition to the family.