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Q2 LCD Grows As Plasma Slows

8/02/2007 09:41:00 AM Eastern

Austin, Texas — The NPD Group’s DisplaySearch company said worldwide LCD TV panel shipments rose a record 32 percent quarter-to-quarter and 65 percent year-to-year to 19.6 million panels in the second quarter of 2007.

DisplaySearch said the second-quarter results exceeded expectations by over 700,000 panels, or 4 percent.

Revenues grew 28 percent quarter-to-quarter and 39 percent year-to-year to a record $7.2 billion.

Average selling prices were dropped just 2 percent quarter-to-quarter and 16 percent year-to-year to $369. For the first time, twice as many over 40-inch LCD TV panels were shipped as 40-inch plasma panels, DisplaySearch said.

The LCD TV share of the 40-inch-plus flat panel market rose from 42 percent in Q2 2006 to 68 percent in Q2 2007.

DisplaySearch attributed the result to “the amount of optimized Gen 7 and larger LCD fab capacity brought online, to the success of LCD TV brands and retailers in getting consumers excited over 1080p TVs where LCDs have dominated PDPs and to the greater number of LCD TV brands overwhelming plasma TV brands in retail.”

Of the total LCD TV panel shipments, the 40-inch-plus share rose from 22 percent in Q1 2007 to 23 percent in Q2 2007 and the 1080p share of all LCD TV panel shipments rose from 10 percent to 11 percent.

Not all larger-sized categories increased share, according to the market research firm, in Q2 2007; the 45- to 47-inch category fell from 5.0 percent to 4.7 percent as prices remained too high for most consumers.

The 32-inch segment remained the dominant size category, earning a 38 percent share with OEMs and brands likely buying more 32 percent panels than they needed as 32-inch panel prices have been rising.

LG.Philips LCD (LPL) remained No. 1 on a unit basis followed by AUO and Samsung. On a revenue basis, Samsung remained No. 1 followed by LPL and AUO.

Plasma panel shipments were flat quarter-to-quarter and down 4 percent year-to-year to 2.3 million panels, DisplaySearch said. Year to date, plasma panel shipments are down 3 percent despite a 51 percent increase in capacity.

“Plasma panel manufacturers were expecting an increase of 18 percent to 2.7 million panels, so clearly Q2 2007 was disappointing,” according to the DisplaySearch report.

With plasma panel prices falling rapidly, plasma panel revenues were down 13 percent quarter-to-quarter and 37 percent year-to-year, to $1.2 billion. Average selling prices were down 13 percent quarter-to-quarter and 34 percent year-to-year, to $507.

Despite the overall PDP decline, growth emerged in the 50-inch-plus segment, particularly in 1080p panels. The 50-inch-plus share of PDP panel shipments rose from 29 percent in Q1 2007 to 31 percent in Q2 2007 on an 8 percent quarter-to-quarter increase and is expected to reach a 34 percent share in Q3 2007 as PDP suppliers continue to shift their focus to larger sizes due to 42-inch share losses to LCDs.

There was also a dramatic increase in 1080p panel shipments, up 545 percent to 169,000 panels with 1080p penetration rising from 1.1 percent to 7.3 percent.

The increase in 1080p shipments and improved supply should improve their competitive position against LCDs.

Matsushita remained No. 1 with Samsung SDI overtaking LGE for No. 2 in PDP panel market share.

Of the five major suppliers, only Matsushita and Samsung SDI enjoyed year-to-year growth. By size, Matsushita led at 37-inch, 42 inch, 55- to 59-inch, and 60 inch-plus while Samsung SDI led at 50 inch. 1080p panels accounted for 17 percent of Matsushita's mix, up from just 2 percent in Q1 2007, according to the report.

Looking forward, PDP suppliers are expecting over a 30 percent quarter-to-quarter increase to over 3 million panels in Q3 2007.

“In order for this to happen, we would expect to see PDP TV brands make significant price moves within the next 60 days,” DisplaySearch said.

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