PDP Volume Slips In ‘07

By Greg Tarr -- TWICE, 5/7/2007

Austin, Texas – Plasma panel shipments fell for the first time on a year-over-year basis in the first quarter of 2007, according to DisplaySearch’s “Quarterly PDP Module and TV Shipment and Forecast Report.”

Plasma panel shipments fell 14 percent quarter to quarter and 1 percent year to year, to 2.3 million panels.

DisplaySearch called it “the lowest result since the third quarter of 2005.”

“Plasma panel suppliers' aggregate survey results indicated that they were expecting flat results in the first quarter of 2007 after a weak fourth quarter in 2006, so the 14 percent decline was disappointing,” DisplaySearch stated.

With the plasma panel surplus widening significantly, blended average selling prices fell 13 percent quarter to quarter and 27 percent year to year to $582, a new low, despite steady gains in average size.

“With units and selling prices down, revenues plummeted 26 percent quarter to quarter and 28 percent year to year to $1.3 billion, the lowest value since the second quarter of 2005,” according to the analyst’s report.

DisplaySearch attributed the decline to a loss of share to LCDs, particularly 1080p LCDs, at 37 inches and larger sizes.

DisplaySearch said that LCD TV panels also experienced a larger than expected decline in the first quarter, down 9 percent from the same quarter in 2006.

This resulted from strong demand in the fourth quarter of 2006, which drew sales that ordinarily would have come in the following quarter.

The average screen size for a plasma panel grew from 43.2 inches in the first quarter of 2006 to 43.9 inches in the fourth quarter of 2006 to 44.3 inches in the seasonally weak first quarter of 2007.

The 50 inch and larger share rose from 26 percent in the fourth quarter of 2006 to 29 percent in the first quarter of 2007 as the 50-42 inch HD price gap narrowed by 21 percent to under $300, DisplaySearch said.

Plasma panels with 1080p resolution “declined faster than the market, dropping 24 percent quarter to quarter,” the analyst said. “This is disappointing given that 1080p LCD panels rose 19 percent quarter to quarter in the first quarter of 2007.

“Plasma panel suppliers need a faster transition to 50 inch-plus and 1080p to offset the rapid price declines and share declines at 42 inches to enjoy revenue growth.:”

Rising competition from 52-inch 1080p LCD is also a concern, DisplaySearch said.

Rapid 1080p growth is expected in the second quarter of 2007 with Matsushita ramping 42-inch and 50-nch PDP along with 58-inch, 65-inch and 103-inch screen sizes. In addition, Samsung and LGE just began shipping 1080p plasma panels in the first quarter of 2007 with Samsung expected to ramp 50-inch and 63-inch 1080p shipments and LGE expected to boost 60-inch 1080p output.

Pioneer and Hitachi are also producing 1080p panels.

By supplier, Panasonic remained No. 1 with a 31 percent share, down from 40 percent, on a 33 percent decline.

DisplaySearch predicted Panasonic would repeat its performance of a year ago and post the fastest growth in the second quarter of 2007, after it launches its new line.

Panasonic was No. 1 in TVs and public displays and led in all 1080p categories as well as at 37 inches. It was No. 2 at 42-inch HD and 50-inch HD.

LGE remained No. 2 with its share rising from 22 percent in the fourth quarter of 2006 to 27 percent in the first quarter of 2007.