Sat, Sep 03, 2005 - Page 10 News List

DisplaySearch sees end to falling revenues

VISION After flat-panel manufacturers weathered two quarters of falling revenues, relief is in sight, with prices expected to stabilize at higher levels in the third quarter


Prices of flat panels used in computer monitors and televisions are expected to extend their gains in the current quarter on strong demand, ending major players' two-quarter decline in revenue, industry watcher DisplaySearch said yesterday.

The revenues of the world's major manufacturers of thin-film-transistor (TFT) display panels, led by LG Philips LCD Co, are expected to jump 35 percent to US$11.1 billion in the current quarter, compared with the same period last year, the researcher said in its latest report.

That would reverse the revenue setback of the past two quarters, when panel prices collapsed due to oversupply pressure.

"Stable panel prices are the major reason behind the solid revenue growth in the third quarter," said David Hsieh (謝勤益), president of DisplaySearch's Taiwan branch.

"We don't see any sign of a fast price decline in the current quarter, as demand for laptop computers looks strong and liquid-crystal-display [LCD] TVs will enjoy explosive growth," Hsieh said.

According to Hsieh, prices of flat panels will rise further during the July-September period, following a 2 percent rebound quarter-on-quarter in the second quarter.

The recovery could weaken a bit in the final quarter of the year after LCD TV makers complete their order placements, causing a slight drop in TV panel prices from last quarter's average of US$389 per unit, he said.

In the April-July quarter, the industry leaders' revenue slid for the second quarter in a row, down 3 percent year-on-year to US$9.8 billion, due to a price slump. In the second quarter, the average selling price of LCD panels plunged 34 percent to US$192 per unit from a year ago, driven by oversupply, DisplaySearch said.

The result beat the researcher's expectation because of strong shipment growth, according to the researcher's report. Shipments of flat panels shot up 46 percent annually to a record high of 50 million units, it said.

Shipments should rise further to 54 million units in the third quarter, DisplaySearch said.

AU Optronics Corp (友達光電), the world's No. 3 LCD panel maker with a market share of 14 percent, told investors last month that output would grow by 10 percent in the third quarter from the previous quarter, citing healthy demand on seasonal factors.

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