LG Display reveals concerns about future growth

LG Display has revealed concerns about the future growth in its panel business due to trade conflicts.
LG Display investmentLG Display said international trade conflicts would undermine the global panel business, as it posted 76 percent drop in third-quarter profit despite a seasonal price boost, Reuters reported.

Recovering Liquid-Crystal Display (LCD) prices ahead of the year-end holidays helped the Apple component supplier to report profit after two consecutive quarterly losses. LG Display says the trend is not expected to continue into the fourth quarter.

Over-supply from China and fears of the economic impact of rising tariffs and protectionism will negatively impact the outlook for the global display panel market, valued at $164 billion by research firm Mordor Intelligence.

“The LCD market is expected to see double-digit growth in supply. As for demand, market volatility continues to grow, as macro uncertainties are aggravated by tariffs, trade frictions and foreign-exchange risks in emerging economies,” LG Display Executive Vice President Don Kim told analysts.

LG Display ranks second by unit shipments in the large LCD panel market after China’s BOE Technology Group, according to IHS Markit data released this month.

LG Display posted operating profit of 140 billion won or $123.2 million during the July-September quarter, after two quarters of consecutive losses, helped by higher seasonal panel prices. LG Display’s revenue dropped 12 percent from a year earlier to 6.1 trillion won.

Prices for 50-inch (127 cm) Liquid Crystal Display (LCD) television panels began to rebound in August to $117 after hitting a record low of $109 in June, according to WitsView, part of research provider TrendForce.

LG Display said the costly OLED TV panel business turned to profit in the third quarter, supported by sales volume growth.

LG Display has faced tough times, cutting benefits for its employees and planning a voluntary redundancy program. This was mainly due to China’s push into the global panel industry and its miscalculations on panel prices.

LG Display said it was developing foldable screens but would take time to commercialize them.