From the press release for Q2 earnings. They left the range unchanged and that should mean that if the 2nd half went well that somewhere in the neighborhood of $230 million in revenues would be probable.
The Company's 2015 guidance remains unchanged. With the OLED industry still at a stage where many variables can have a material impact on its growth, Universal Display continues to expect its 2015 revenues to be approximately $200 million, with a downside range of approximately 5% and an upside potential of approximately 15%.
They reiterated guidance of $200 million with 5% downside and 15% upside. If that guidance was based on anything at all, then the high-side should be in play.
If not, what scenario was management dreaming about when they decided that they would leave the possibility of $230 million in revenue in their guidance? Note that I dont expect anywhere near that number, which just illustrates how management has lost credibility with me and almost everybody on this board. The overwhelmingly positive news since August justifies looking at the high-end but nobody expects anything close to that.
Conversely, management didnt know that Samsung would hit 90% plus utilization or that LGD would successfully ramp the rest of their capacity and have huge price cuts across the board. They had five weeks of sales in the 3rd quarter plus some data on orders from which they had to extrapolate the entire 2nd half.
We should be talking about hitting the high end of the yearly guidance considering the strength in the end markets. IMO, the fact that we arent speaks to managements credibility in giving guidance. The shape of the 2nd half doesnt matter much but the absolute minimum that we should expect is a reiteration of the $200 million guidance target.
If the market sells of on $35 million and a reiteration of the $200 million target then it is an opportunity....and hopefully the last one for a while.
zik wrote..."Yes, they did mention the use of OLED in Samsung mid-range phones, although not specific models or quantities. "
The J-Series isnt the mid-range. The J2 and J1 Ace represent Samsung's low end smartphone offerings and the fact that they are using OLED's changes everything. The volume on the low-end dwarfs the mid-range of the market. IHS was simply behind the curve, which isnt unusual at all.
I wouldnt worry about the normal seasonal pattern for Samsung in the 2nd half. If the Korean analysts are to be believed, Samsung is operating at 90%+ capacity utilization for the entire 2nd half. They literally couldnt sell many more units....
The end markets simply could not have gone better since the August earnings call.
It is in the 10Q filing under concentration of risk.
We'll find out in two weeks.
However, the time to short is when the stock is high and the end markets are weak. We have the reverse situation right now.
UDC had ~$18.5 million in revenue from LGD in the 1st half and that only covered 25% of unit production for the year. I expect LGD will get more efficient with their processes but some of that will be offset by the fact that area per unit will be higher in the 2nd half.
Combine the increase in production at LGD with Samsung dramatically increasing their utilization rate and UDC absolutely should hit their guidance. If not, what the hell was management expecting out of their end markets?