Sigmaintell: Next-gen display panel to further penetrate to 50% by 2026

The flexible display panel industry is poised to see speedy growth in China as major domestic panel makers have scaled up production capacities in the thinner and foldable screens used for smartphones, owing to the maturity of technologies and cost reductions.

Statistics from Sigmaintell Consulting, a Beijing-based market research firm, showed the global shipment of flexible organic light-emitting diode (OLED) panels is expected to reach 405 million units in 2022, with Chinese display makers accounting for about 36 percent of the market share.

Statistics from the consultancy showed the shipment of foldable smartphones surged 171.9 percent on a yearly basis to about 7.21 million units in 2021, and the figure is foreseen to reach 14.4 million units this year, an increase of 99.6 percent year-on-year.

Industry experts said that compared with the traditional liquid crystal display (LCD), OLED is the next-generation display technology that has great improvements in terms of image contrast, brightness and color spectrum, thus further accelerating the upgrade of the display industry.

The penetration rate of OLED panels in the smartphone market worldwide will stand at 50 percent by 2026, according to Sigmaintell.

BOE Technology Group Co Ltd, a leading Chinese display panel supplier, topped the domestic market with flexible OLED panel shipments of about 60 million units in 2021, up nearly 60 percent year-on-year. It became the world's second-largest OLED maker next to South Korea's Samsung Display, it added.

The total revenue of BOE stood at 219.3 billion yuan ($34.4 billion) last year, up 61.79 percent year-on-year, while its net profit surged 413 percent to a record high of 25.8 billion yuan. The company's output growth of OLED panels is higher than that of LCD(42 percent).

Its flexible display screens have been applied in some of the latest flagship smartphone products, such as Honor's Magic 4 series and Oppo's Find X5. The company's OLED panel shipments are expected to exceed 100 million units this year, BOE said.

At present, BOE owns three sixth-generation flexible active-matrix organic light-emitting diodes, or AMOLED, production lines. It started mass production of the flexible panels from its facility in Chengdu, Sichuan province, in October 2017.The panels have already been used by more than 10 smartphone manufacturers.

The company's second production line in Mianyang, Sichuan province, began mass production in 2019, while its third facility in Chongqing was put into operation last December.

Gao Wenbao, executive vice-president of BOE, said that there is surging demand for OLED panels, which are mainly used in mid-range to high-end smartphones and it will also expand the application scenarios of OLED in the wearable devices segment.

Visionox Technology Inc, another Chinese display panel supplier, said it will continue to focus on cutting-edge AMOLED technology, which is expected to have wider applications in smartphones, computers, smart wearables, vehicles, smart homes, virtual reality and augmented reality.

Zhu Xiujian, general manager of Visionox's product engineering center, noted that flexible and foldable screens will play a vital role in bolstering the growth of small and medium-sized smartphones.

Li Yaqin, general manager of Sigmaintell, said demand for flexible OLED panels used in foldable smartphones will continue to increase this year on the back of the commercial application of 5G technology, and panel makers should further improve their yield rate capacities and reduce production costs.

Flexible OLED panels will gain popularity in mid-range smartphones which will be priced at more than 2,500 yuan by 2025, Li said.

Foldable smartphone shipments are forecast to increase by a compound annual growth rate of 53 percent between 2021 and 2024 to exceed 30 million units in 2024, according to market research company Canalys.

"While there is an increasing number of suppliers for foldable displays, hinges and other key components, device vendors are also highlighting innovative engineering solutions and product designs for a better user experience while constantly pushing down prices," said Amber Liu, a research analyst at Canalys.

Liu expects to see many new foldable device launches as vendors continue reducing thickness, weight and prices, which will be vital for mass-market adoption. The leading players will start to flex their muscles in the ecosystem to leapfrog their competitors with advanced and differentiated experiences, she added.