Era Of Quarterly Growth For LCD-TV Shipments Ending: iSupply

By Staff On Dec 17 2007 - 8:00am

While global unit shipments of LCD TVs are expected to hit a record level in the fourth quarter, this record won't be matched again until the third quarter of 2008, according to iSuppli market research. This marks the end of the era of sequential quarterly unit shipment growth for LCD-TVs, a period of historic expansion for the market that has lasted since 2005.

LCD-TV shipments are expected to reach the 25.1 million unit mark in the fourth quarter —the product's largest quarterly unit volume to date, according to iSuppli.

However, in the first quarter of 2008, LCD-TV unit shipments will decline to 19.5 million units. "The slower first- quarter shipments are the result of seasonal factors," said Riddhi Patel, principal analyst for television systems for iSuppli. "But LCD-TV shipments in the second quarter of 2008 will amount to only 21.9 million units, still down from the peak level in the fourth quarter of 2007. But once the third quarter comes around, LCD-TV unit shipments will reach a new historical quarterly high."

Further proof of the slowdown can be found in the quarterly compounded growth rates for 2007 and 2008. The compounded quarter-to-quarter growth for LCD-TV shipments for the period of 2007 through 2008 is expected to be 11.5 percent. In comparison, quarterly compounded growth in 2005 through 2006 was 22.7 percent.

While this represents a significant slowdown compared to previous years, LCD-TV shipments will continue to grow at an impressive rate during the long term.

The Compound Annual Growth Rate (CAGR) for LCD TVs for the period of 2006 through 2011 will amount to 31.9 percent. The global LCD-TV market will hit 165.3 million units in 2011, up from 41.4 million in 2006. Overall LCD-TV shipments in 2008 will amount to 98.5 million units, up from 75.7 million units in 2007.

So, despite a slowing in growth in the first half of 2008 compared to the fourth quarter of 2007, overall growth in 2008 will still be quite significant.

Revenue in the global LCD-TV market will reach $116.2 billion in 2011, increasing at a 19.4 percent CAGR from $47.8 billion in 2006.

The above chart represents iSuppli's forecast for global unit shipments and revenue for LCD-TVs for the period of 2006 through 2011.

After declining for two quarters in a row, plasma display panel TV shipments picked up in the third quarter of 2007, reaching 2.9 million units, up from 2.3 million units in the second quarter and up from 2.5 million units in the third quarter of 2006. Much of this growth took place in the Middle East and African regions. China also saw growth of 38 percent in PDP-TV shipments in the third quarter.

Plasma shipments are slowing as well. However, the market will continue to grow as PDP-TV shipments rise to 19.3 million units by 2011, up at a CAGR of 15.8 percent from 9.3 million units in 2006. Unfortunately, plasma revenue will decline to $14 billion by 2011, contracting at a negative CAGR of 2.6 percent, down from $15.9 billion in 2006.

However, deep cuts in the average selling price of these televisions are allowing plasma TV manufacturers to remain competitive. While plasma TVs will never match the popularity of LCD-TVs, iSupply said, plasma isn't going away any time soon. This is because manufacturers are working to improve the quality of their panels in order to cut costs and to remain competitive with LCD TVs in terms of picture resolution.

For more information on iSuppli's Television Systems service, please visit www.isuppli.com/catalog/L2_tele.asp.

iSuppli's North American TV shipment forecast will appear in the Jan. 7, 2008, issue of TWICE.