Interface News Reporter |
Interface News Editor|Lin Teng
As of April 30, A-share panel manufacturers have released their 2023 annual reports.
The interface news reporter combed through the 2023 annual reports of 8 listed companies including BOE, TCL Technology, and Shenzhen Tianma, and found that only two companies, TCL Huaxing and Rainbow Co., Ltd., increased their net profits by 100.04% and 124.83% year-on-year, respectively. Although BOE remained profitable, its net profit fell by 66.22% last year. The biggest change in net profit was Shenzhen Tianma, down 1978.03% year-on-year.
On the whole, the panel industry will still be affected by the downward cycle of the industry in 2023, and panel companies will generally lose money, but since the second half of last year, the industry has ushered in signs of recovery, and the profitability of enterprises has been significantly improved, and the recovery of the industry is still continuing.
The industry bottomed out after two years of adjustment, and the price increase of large-size TV panels was the most obvious
As China's largest panel company, BOE's net profit in the fourth quarter of last year was about 1.53 billion yuan, accounting for about 59.85% of the annual net profit. Compared with the first three quarters, BOE's revenue in the fourth quarter increased by only 3%, but its net profit increased by more than 4 times. The recovery of the industry has a particularly obvious impact on the performance of head panel enterprises.
In 2023, TCL Huaxing's net profit will decrease by 7.618 billion yuan year-on-year, and it will begin to turn losses into profits in the third quarter, and continue to achieve good profitability in the fourth quarter, with a total profit of 3.441 billion yuan in the second half of 2023. This has also become an important factor driving TCL Technology's net profit in 2023 to increase by 747.60% year-on-year.
It is worth mentioning that the net profit of Rainbow shares in 2023 will be "far ahead" among the above 8 companies with a growth rate of 124.85%, and it will take off the hat of "loss king" of Shaanxi stocks.
Rainbow said that the LCD panel market will bottom out in 2023, and the company's operating income and net profit will increase significantly year-on-year due to the rise in panel prices. The company's strategies include shrinking and eliminating low-efficiency models, expanding the proportion of production capacity of large-size models, etc., and the operating performance has turned losses into profits.
At the same time, Rainbow Co., Ltd. is speeding up the construction of LCD substrate glass production lines in Hefei and Xianyang bases, and the completed production lines have been put into operation rapidly, and the production, sales and operating income of substrate glass have increased significantly year-on-year.
According to the disclosure of Rainbow shares in the annual report, the company has formed the world's only industrial layout with the linkage effect of "substrate + panel" upstream and downstream industries. In 2023, the revenue of Rainbow's glass substrate business will account for about 10%, and the gross profit margin will reach 18.66%, which is higher than the industry's LCD panel gross profit margin.
Shenzhen Tianma incurred a huge loss of nearly 2.1 billion yuan last year, which also aroused the attention of the Shenzhen Stock Exchange, and the Shenzhen Stock Exchange issued a letter of inquiry asking it to explain the reasons for the loss.
In its reply to the inquiry letter of the Shenzhen Stock Exchange, Shenzhen Tianma said that due to the impact of factors such as the external environment and industry changes, the average price of display products was significantly lower than that of the same period in 2022, and the company's consumer display business, which accounted for a large proportion of revenue, especially the profitability of smartphone display products, fell sharply year-on-year, and at the same time, the depreciation of Wuhan AMOLED production line (depreciation amount of 799 million yuan) increased to compress AMOLED The profit margin of flexible mobile phone display products comprehensively led to a year-on-year decrease of 1.87 billion yuan in the company's gross sales profit, a year-on-year decrease of 46.10%.
From the perspective of revenue structure, in 2023, among the revenue of Shenzhen Tianma's display business, the mobile phone and IT panel business all belong to the consumer goods display business, accounting for about 51% of the company's main business income, vehicle display accounts for 25.22%, and the rest is professional display and other businesses. In other words, the mobile phone and IT panel business, which accounts for half of Shenzhen Tianma's revenue, is the "hardest hit area" with a net profit loss of nearly 2.1 billion yuan attributable to its parent company in 2023.
In 2023, according to data from third-party institutions such as Omdia and Qunzhi Consulting, the average price of mainstream mobile phone display products in the industry will drop by about 30%. Those manufacturers whose main business is mobile phone panels had a bad time last year.
For example, Visionox's products shipped in 2023 are mainly flexible AMOLED technology products, and its AMOLED smartphone panel shipments rank among the top three in the world, but due to the pressure on consumer electronics terminal demand, AMOLED production capacity has been further released, and product prices have fluctuated greatly, resulting in a decline of 20.74% and 80.31% in revenue and net profit last year, respectively.
Panels are recognized as a strong cyclical industry, and their cyclicality is mainly caused by the superposition of production capacity and demand cycles and economic cycles. Since the second half of 2021, after the price began to fall, the panel quotation has continued to decline, and after two years of adjustment, the panel industry has finally bottomed out and rebounded, ushering in a recovery momentum.
At present, the price increase of large-size TV panels is the most obvious in the downstream applications of panels, while the prices of small and medium-sized panels are relatively stable, and some products have seen structural price increases.
Qunzhi consulting data shows,It is expected that by the middle of the second quarter, the prices of mainstream TV panels will continue to rise。 Among them, the price of small and medium-sized LCD TV panels is expected to rise by $1-2 per month, and the demand for medium- and large-size panels of 55 inches and above is relatively strong, and it is expected to rise by $3-4 per month.
Peng Shuanglang, chairman of panel manufacturer AUO Optoelectronics, said on April 24 that the large-size, TV market is recovering, and the IT market is stimulated by AI PCs, ushering in strong demand in the second half of the year.
With the recovery of the industry, in the first quarter of this year, the above 8 panel companies in addition to Hehui Optoelectronics, the other 7 revenue and net profit have achieved year-on-year growth, of which BOE's net profit in the first quarter increased by 297.8% year-on-year to 984 million yuan, rainbow shares net profit increased by 160.32% year-on-year to 278 million yuan, TCL technology net profit increased by 143.71% year-on-year to 240 million yuan, turning losses into profits, and its semiconductor display business net profit improved by more than 3.3 billion yuan year-on-year.
It is not difficult to judge that if the prosperity of the panel industry continues, the industry is expected to continue to enhance profitability.
The proportion of domestic OLED production capacity is expected to continue to increase, and 2024 will become the first year of Micro LED mass production
In addition to the cyclical nature of the panel display industry, it also has the characteristics of continuous update and iteration of industrial technology routes. Under the trend of industry recovery, panel companies are stabilizing production and customers on the one hand, and on the other hand, they are also paying close attention to the development of next-generation display technology.
At present, the technological transformation of display panels is at the crossroads of industry development, and LCD, OLED, Micro LED and other technologies are fiercely competing and competing in their respective tracks and product intervals.
LCD technology is the most mature, the price is relatively cheapest, the largest market scale, in the field of large size and medium size, LCD is still the mainstream display technology in the long term; OLED is the most advanced in the mainstream market, suitable for high-end products, has occupied a mainstream position in the mobile phone market, and gradually penetrates into new application scenarios, folding screen OLED or will become a new growth direction; Micro LED is regarded as the next generation of display technology.
Industry insiders judge that in the next 10 years, there will be a situation of coexistence of multiple technologies in the display industry. In view of this, BOE, TCL Huaxing and other manufacturers usually take a multi-legged technological development path.
For example, as early as 2017, in the context of fierce competition in the entire LCD landscape, TCL chose to cut into the Mini LED track to achieve overtaking. Mini LED backlight products are still LCD in essence, but the backlight technology is upgraded to a more miniaturized one, which can achieve precise area luminescence adjustment and improve the display effect.
In 2019, TCL became the first company to achieve mass production of Mini LED TVs. At present, TCL has a market share of more than 50% in the domestic market for three consecutive years in the field of Mini LED TVs and 98-inch large-screen TVs.
Qunzhi Consulting predicts that the global TV market shipments are expected to decline to 215 million units in 2023, a year-on-year decrease of 2.5%. In this case, the performance of Mini LED TVs is still strong, so 2024 will also be the focus of manufacturers' layout.
In the field of OLED display, evaporation technology and inkjet printing are the two major technical paths, and at this stage, OLED panels generally use vacuum evaporation technology. China's panel factories, represented by TCL Huaxing and BOE, are continuing to increase printing OLED technology to promote the arrival of the era of industrialization.
On March 14, Liu Xiaolan, vice president of TCL Huaxing, said that at present, TCL Huaxing's printing OLED trial production line equipment in Wuhan has been installed, and it is expected that there will be product output by the end of this year.
At present, BOE has invested in Chengdu, Chongqing, Mianyang to build three 6th generation flexible AMOLED production line, on March 27, BOE announced that on this basis, it announced the construction of the first 8.6 generation AMOLED production line in China, to promote the OLED display industry into the stage of medium-sized development.
At present, the OLED penetration rate in the mobile phone field has exceeded 50%, and the market share of its Chinese-made panel factories in the OLED field is still expanding. According to the latest data from Cinno Research, in the first quarter of 2024, TCL Huaxing AMOLED smartphone panel shipments increased by 294.0% year-on-year, and the market share increased by 6.4 percentage points year-on-year to 10.1%. In 2024, BOE's annual shipment target of flexible OLED panels is 160 million pieces, a year-on-year increase of more than 30%. According to The Elec, smartphone OLED orders from companies such as Shenzhen Tianma and Visionox have also increased, and some companies expect their smartphone OLED production line capacity to be fully operational in the second quarter.
As domestic manufacturers actively deploy and invest in related production lines, the proportion of domestic OLED production capacity is expected to continue to increase.
As a next-generation display technology, Micro LED technology has advantages in brightness, resolution, contrast, power consumption, etc. In terms of policy, the "14th Five-Year Plan" clearly regards Micro LED as a scientific and technological breakthrough in the field of future displays. In terms of first-mover advantage, China, as one of the three birthplaces of Micro LED, has a rich and independent and controllable intellectual property layout in the original core technology, equipment and raw materials of Micro LED.
It is worth mentioning that Micro LED technology also shined at CES and MWC at the beginning of this year, in addition to the display of transparent display technology in large, automotive, notebook and other applications, AR glasses focused on by many manufacturers are also a highlight.
For the display industry, it may only be a matter of time before Micro LED becomes the mainstream of the market. In this regard, major panel companies have already taken action.
At the end of 2023, Chenxian Optoelectronics revealed that the company's TFT-based Micro LED display production line is undergoing infrastructure work, and mass production is expected to be achieved in the second half of 2024. Subsequently, Tianma New Display Technology Research Institute (Xiamen) Co., Ltd., a subsidiary of Shenzhen Tianma, held the first equipment moving ceremony of the Micro LED production line project, which was invested and built by Shenzhen Tianma in 2022 from the mass transfer to the full process of display module Micro LED production line.
On January 31, BOE HC Semitek Zhuhai Micro LED Wafer Manufacturing and Packaging and Testing Base Project was capped, the project covers an area of about 217 acres, with an investment of about 2 billion yuan, and will light up the first product in September 2024, and plans to mass produce in December this year, with an annual output of 58,800 Micro LED wafers in the future.
Combined with the dynamics of various panel companies, 2024 is expected to be the first year of Micro LED mass production, and more and more companies will achieve small-scale mass production of Micro LED in the second half of this year, and then start impulse in 2025.
The market research firm Omdia pointed out that the micro LED display panel market is expected to grow really from 2025, mainly due to the demand for small display devices such as extended reality (XR) devices and smart watches, which are commonly used outdoors.