Next slide please. This conference call will take an hour. Before we go into the Q&A session, please allow me to highlight our first quarter year 2012 result, performance highlight and outlook.
Originally, our panel shipment for first quarter was expected to be similar to the fourth quarter with a channel inventory restocking demand and new model line-up by set makers, as well as launch of our differentiated products. However, some delay in the schedule of differentiated product and new model development resulted into 4% shipment decrease.
Operating loss continue to while panel price remained stable after slight decline all in the quarter. Cost reduction recorded low single-digit. There is improvement effort to increase competitiveness in first quarter affected the result negatively due to some delay of new model shipments. As most of the issues have been already resolved, we expected these efforts to bear fruit in second quarter leaving to the meaningful improvement in the results.
Looking at second quarter, the demand is expected to be stronger, while the inventory level industry-wide remains low. Order from our customers is expected to be strong with new model line-up in preparation for the sports events.As a portion of differentiated products including FPR 3D, panels for smart devices continues to expand, in an improving market situation, we expected a sound profit in second quarter. However, as the global economic scale remains uncertain, there are some uncertainties in the market which could potentially impact the panel shipments. Looking at the overall Display industry, we feel it is indisputable that LCD has entered maturity and slow growth stage. LG Display has carefully carryout thorough analysis in the strategic direction and investment plans with the following three points under consideration. Number one, the optimization of the interesting LCD business, number two, taking leadership in the largest OLED TV market and number three, finding future growth engine.