El Segundo, Calif. — After three consecutive down quarters, the global market for LCD-TV panels returned to profitability in the second half of 2009, paving the way for revenue growth in 2010, according to iSuppli Corp.
The market researcher forecasts that global shipments of large-sized LCD panels used in televisions will reach $49.2 billion in 2010, up 40 percent from $35.2 billion in 2009, driven by increased demand, the shift to larger-sized displays, rising sales of higher-value panels and increased manufacturing efficiency.
The projected revenue increase for this year follows a 5.2 percent decline from 2008 to 2009, says iSuppli.
A key finding of iSuppli’s report, “Large-LCD Market Bounces Back With Unit and Revenue Growth“, indicates that the overall industry bounced back to a 10 percent profit margin in the third quarter of 2009 after successive quarters of negative performance. Suppliers had their first setback in the third quarter of 2008 when sales of 32-inch panels, the most popular LCD-TV size, yielded zero profitability, says iSuppli.
This was followed by a loss of 23 percent in the fourth quarter of 2008, and negative margins of 31 percent and 12 percent, respectively, in the first and second quarters of 2009, says iSuppli.
A return to profitability for 32-inch LCD-TV panels is now expected to continue to rise throughout 2010, reaching 25 percent in the fourth quarter, according to the market researcher.
Sweta Dash, senior director, LCD Research, for iSuppli says the higher-value panels will feature LED backlighting, full high-definition resolution and faster refresh rates of 120 Hz and 240 Hz. Dash also says that television brands in 2010 are planning to focus on 3-D solutions that will lead to faster adoption of higher-frequency panels such as 240 Hz.
“On the supply side, increased production efficiency from 8.5 and higher-generation fabs are also going to make larger-size TVs more affordable for the consumers. Furthermore, suppliers are set to cut costs by reducing the number of components used in TV panels, further bolstering profit margins,” Dash stated.
However, it’s a different story in the global LCD monitor market, which is expected to grow only 3 percent in 2010, reaching 161 million units, according to WitsView.
Competitive pricing will be the key to market dominance amid a market devoid of marketing buzz or significant breakthroughs, says WitsView. As a result, LCD monitor vendors can only attract consumers’ attention through lower prices, says the market researcher.
Linda Lin, analyst for WitsView, says since it is difficult to raise street prices of LCD monitors, entry-level or low-priced products promoted by first-tier vendors will continue to dominate the market.
As for touch-screen and 3D applications, these new features will not become the market mainstream this year, says Lin, due to their high costs and the need for technology improvements.