Overall OLED shipments reached more than 61 million units for the year 2005, and revenues hit almost US$600 million, according to Displaybank (CEO Kwon Sang-Sei), a market research firm.

The OLED market for the year grew fast by 65%, slightly below expectations, and on a regional basis, Taiwan took the lead by achieving an upsurge in shipments from 11 million units in 2004 to 27 million units in 2005. Next came Korea increasing shipments from 16 million units to 22 million units, and Japan posting growth from 7 million units to 8 million units.

Samsung SDI has maintained the world's top position since the third quarter of 2005, with its shipments exceeding the overall shipments. In addition, LG Electronic recorded 1 million units in the fourth quarter, demonstrating that it has managed to overcome weak performance.

The upward trend by Taiwanese companies, who succeeded in gaining considerable ground for the first quarter, slowed for the fourth quarter, but they still account for more than 40% of the global market, with the world's largest number of OLED panel makers in Taiwan. However, fourth-quarter performance was somewhat weak, and notably, RitDisplay, which has maintained sharp growth, saw a decline in shipments in spite of its corporate strategy of focusing on the PMOLED business. Nevertheless, we foresee that Taiwanese players will grow sharply into 2006 despite low yields and low financial stability.

In Japan, in the meantime, Pioneer and TDK were the only companies in the PMOLED industry to record a certain volume of shipments. Apart from mobile handsets and MP3 players, they enjoyed robust sales in the car audio application market, with the top two players carving out more than 90% of the total car audio application market.

Figure 1. Regional OLED Shipment Results (2004~2005 quarterly)
 

After stagnating from the third to fourth quarter of 2004 due to a supply glut caused by manufacturers' massive capacity expansions for the first half of 2004, the market has rebounded since the first quarter of 2005. Specifically, growth during the second quarter was outstanding. This upward trend continued into the second half of 2005, posting overwhelmingly higher figures than those in the first half a year ago. We believe that the OLED market will see dramatic growth buoyed by positive factors such as launches of commercial AMOLEDs for the second half of 2006.

Even though a Taiwanese vendor moved into first place for a while in early 2005, Samsung SDI took the lead back in the second half. Moreover, Samsung SDI maintained the No. 1 position in terms of revenues. This trend is forecast to continue through 2006.

Bad news such as announcements of business withdrawals from Japan's Pioneer and SKDisplay, which were at the forefront in the initial stage of the AMOLED market, came in a rush towards the year 2005. Unlike Korean and Taiwanese competitors, which will gear up to make inroads into the market through 2006, Japanese vendors are unlikely to join the market race until 2007.

In conclusion, the OLED market is estimated at 61.1 million units for US$620 million for 2005. In 2006, AMOLED market entrances and the shift towards high-end PMOLEDs are expected to become major contributors to accelerating growth in the market to 100 million units in 2006 for US$900 million.