Originally, our panel shipment for first quarter was expected to be similar to the fourth quarter with channel inventory restocking demand and new model lineup 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 in 4% shipment decrease.
Operating loss continued while panel price remained stable at a slight decline all in the quarter. Cost reduction recorded low single-digits. There is improvement effort to increase competitiveness in first quarter affected the results negatively due to some delay of new model shipments. As most of the issues have been already resolved, we expect these efforts to bear fruit in second quarter leading 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 lineup in preparation for the sports events.
As the portion of differentiated products including FPR 3D panels for smart devices continues to expand in an improving market situation, we expect to turn 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 is carefully carrying out thorough analysis in the strategic direction and investment plans with the following three points under consideration; number one, the optimization of the existing LCD business; number two, taking leadership in the larger OLED TV market; and number three, finding future growth engines. China investment which is to be carried out in the near future will also be a part of LCD business optimization by expanding access to the China market and obtaining cost competitiveness. We will tell you more about these long-term strategic direction and investment plans in the next quarter earnings.
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV