Universal Display Sees Its OLED Technology Shine through Samsung at CES
When Samsung Electronics unveiled its new 55-inch screen organic LED television at the International Consumer Electronics Show, Universal Display (Nasdaq: PANL) in Ewing, NJ saw its own prospects rise. Organic LED (OLED) technology uses razor-thin layers of organic semiconductor material to generate light and electronic displays. It is an alternative to traditional LED and LCD technology and offers the potential to create devices that are lighter and use less energy. OLEDs do not use backlighting, which some LED and LCD displays require.
Universal Display develops OLED material and technology it licenses to manufacturers such as Samsung. While OLED screens have made their way into handheld-size devices such as Samsung’s Galaxy series of smartphones, production of larger displays that use the technology has been limited so far.
That seems to be changing with the debut of 55-inch OLED televisions from Samsung and a wicked thin 55-inch television from LG Electronics due for sale by the later half of this year. Steven Abramson, CEO of Universal Display, visited CES in Las Vegas but did not exhibit though his company’s technology could be found around the show. The plethora of smartphones and other devices built with OLED displays increases demand for the technology, he says. “We’ve been laboring in this vineyard for a long, long time,” Abramson says. “After sixteen years, we’re finally starting to see this take off.”
In addition to Samsung, other manufacturers tap into Universal Display’s research and development. “LG is buying material from us,” Abramson says. “We’ll eventually have a long-term agreement with them. Our revenues grow as the OLED industry grows.”
Universal Display reported net income of nearly $6 million on revenue of $21.8 million for the quarter ended Sept. 30, 2011 compared with a net loss of $7.2 million on a bit less than $7.1 million in revenue for the prior year period. The company also has cash to expand thanks to a secondary offering last March that raised some $250 million. “We raised the money with the possibility there may be acquisitions down the road,” Abramson says.
Advances in OLED development are hard to miss given the new televisions revealed at CES. Prior to this week, demo versions of OLED televisions have been seen up to the 32-inch class. LG Electronics and Samsung presented their respective 55-inch OLED televisions as high-profile products at CES with promises to make them available to consumers—though neither company released pricing details.
It is fair to assume they will not be cheap. OLED technology lets manufacturers produce skinnier and lighter televisions that use less energy than some other flat panel displays. For example, LG’s new OLED television clocked in at a depth of 4 millimeters, or 0.157 inches, thin at its narrowest edge and weighs 7.5 kilograms, or about 16.5 pounds.
Televisions and smartphones are not the only places where OLED technology can be found. Universal Display announced on Monday a new license agreement with Lumiotec in Yamagata, Japan. Lumiotec will use Universal Display’s OLED materials and technology in lighting products, which Abramson says consume less energy than other light sources. “What Thomas Edison invented is a heat-generating device that gives off a little bit of light,” Abramson says. “OLED is a light-generating device that gives off a little bit of heat.”
OLEDs, thanks to the thinness and flexibility of the material, can also take on different shapes. Rather than clunky bulbs, flat OLED light panels can be placed along walls or other surfaces. OLED electronic displays can also take on unusual forms. “We’re working with the Army to develop an unbreakable display for our soldiers,” Abramson says. The electronic display for military use is mounted as a wristband that would feed information to soldiers.
Abramson says Universal Display, founded in 1994, has been working to silence those who doubted OLED technology’s commercial viability. Prior criticism may have been somewhat reasonable. Challenges in manufacturing the material contributed to the slow adoption of OLEDs in consumer technology. “When we started doing this,” Abramson says, “people were making very small OLEDs about one inch diagonal.”
The potential of the technology drew more players to the industry, though some stumbled as the market developed. Kodak and Sanyo Electric formed a joint venture in 2001 called SK Display to develop OLED screens for cameras and other devices. “The camera had a great display but didn’t work that well,” Abramson says. Sanyo and Kodak ended the joint venture in 2006.
Samsung in particular has been bullish on OLED technology, using it in a variety of its smartphones, cameras, and tablet devices. “Samsung makes over 90 percent of all OLED panels worldwide,” said Tim Baxter, president of Samsung Electronics America in Ridgefield Park, NJ, during the company’s CES press conference.
The capital investment by Samsung for OLED production contributed to the industries evolution, Abramson says. “Samsung really put their oar in the water with the Galaxy smartphones,” he says.
Abramson expects the growing demand for OLED technology to continue elevating Universal Display. He says company is expanding its material development and plans to grow its staff of 90 in New Jersey as well as Asia. “That’s where the industry is located,” Abramson says, regarding Asia. “We want to be close to our customers.”
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