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Large LCD shipments declined again in Q4

Post Time:Jan 06,2009Classify:Industry NewsView:322

SAN FRANCISCO—Worldwide large-sized LCD panel unit shipments decreased by 5 percent in the fourth quarter of 2008, following a 3 percent drop in the third quarter, market research firm iSuppli Corp. said Monday (Jan. 5). The firm cut its estimate for large-sized LCD panel revenue in 2008 by 8 percent.

Approximately 108.1 million large-size LCD panels shipped in the fourth quarter, down from about 114.4 in the third quarter, iSuppli said. Revenue from these shipments declined to about $15 billion, down from more than $18 billion in the third quarter, the firm said.

"Television, monitor and notebook PC makers are slashing orders for large-sized LCD panels due to weak holiday season sales, reflecting the global downturn in consumer and corporate demand," said Sweta Dash, senior director of LCD research at iSuppli, in a statement. "The recession in the global economy has impacted all areas of the electronics value chain, including large-sized LCDs, an area that will continue to struggle into the first quarter of 2009."

The market for large-sized LCD panels, defined by iSuppli as those having a diagonal dimension of 10 inches or more, has been struggling through severe oversupply conditions since the beginning of June, according to the firm. The market has been hurt by lower-than-expected panel demand and high levels of inventory building up throughout the LCD supply chain, a situation that got worse when the global financial crisis hit in September, iSuppli (El Segundo, Calif.) said.

"Panel prices are continuing to fall, even though some prices are already at or even less than the cash cost level," Dash said. Monitor panel prices have declined by 40 to 45 percent since June, while notebook and television panels have experienced similar declines, Dash said.

LCD suppliers cut their utilization rates in the fourth quarter, according to iSuppli. Some are reducing utilization rates by 40 percent and are running their fabs at 60 percent of capacity level, while some fabs are even running below the 50 percent level, the firm said.

Due to the financial crisis and worldwide recession, iSuppli said it reduced its large-sized LCD forecast for 2008 and 2009. The change in the unit shipment forecast is less than 5 percent for 2008, but the revenue forecast for 2008 is 8 percent that iSuppli's previous forecast the firm said. Total 2008 large-panel LCD shipment revenue came in at about $75.7 billion, according to the firm's revised forecast.

Revenue impact may be even greater in 2009 unless the market can stabilize by the third quarter of the year, iSuppli said.

"Oversupply and drastic price reductions are nothing new to the large-sized LCD panel market as the industry generally uses the strategy of capacity expansion, price reduction and demand creation to boost sales and increase the LCD's dominance in the display market," Dash said.

Source: EE TimesAuthor: shangyi

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