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HIMS Sees Lower OLED Orders, Adds Semiconductor Equipment to Maintain Revenue Growth
South Korean display equipment maker Hims is aiming to reduce its reliance on OLED equipment this year from sales in new areas. Hims CEO JH Kim said at its shareholders’ meeting that the company has been preparing to enter the semiconductor equipment and software businesses for the past two to three years. These new areas will start contributing sales as early as this year or next year, Kim said. Hims currently rely on OLED equipment for up to 90% of its sales. In 2017, thanks to its major customer Samsung Display investing on its A3 production line dedicated to Apple, Hims recorded 91.4 billion won in sales and 15.6 billion won in operating income. But in 2018, Samsung Display drastically reduced its spending on facilities, which caused Hims sales to decline 60% compared to the previous year. It also turned to an operating loss in the same year.
In 2020, thanks to Samsung Display’s spending on quantum-dot (QD)-OLED panels, Hims sales increased 24.9%. OLED equipment contributed 93.8 billion won in sales, accounting for 88.3% of its total 106.2 billion won sale in that year. Kim said the company recorded its all-time highest sales in 2020 thanks to winning major orders from customers. From December 2019 to January 2020, Hims won orders from Samsung Display, CSoT and Tianma, worth 23.1 billion won, 12 billion won and 16.3 billion won, respectively.
Hims is an exclusive supplier of mask stretcher to Samsung Display. The stretchers are used to stretch the fine metal mask and open masks flat during the OLED deposition process. Kim warned that demand for display equipment this year is concerning compared to 2020 as its customer’s spending plans are uncertain. However, demand for OLED is expected to continue, he said, and as long as the company overcomes uncertainties this year it will be able to secure new opportunities.
Chinese panel companies are likely to spend conservatively this year compared to before to focus on improving their yield rates rather than expanding facilities. Hims' remaining order has dropped at the tail end of 2020 to 14.5 billion won from 64 billion won in 2019. Hims is competing with Hansong Neotech and KPS in orders for mask from China.
The supply of tape COF substrates is expected to fall short of demand in 2021, due to growing COF packaging demand for OLED display driver ICs (DDI) , according to industry sources.
Chinese handset vendors Oppo, Vivo and Xiaomi have turned to COF-processed OLED DDIs, the sources said, and over 50% of OLED DDI chips are expected to adopt COF technology in 2021, significantly adding shipment momentum for Taiwan's tape COF substrate suppliers JMC Electronics and Chipbond Technology, the sources said.
COF technology can process different sizes of DDIs for handsets, notebooks and TVs, and strong demand from terminal markets have enabled backend houses to sustain full capacity utilization while also ramping up shipments of tape COF substrates from suppliers, the sources continued.
Relatively mature COF packaging technology has become top choice for processing both LCD and OLED DDI modules at backend houses despite higher unit cost than COP technology, the sources said, reasoning that poor yield rates for COP process may undermine the entire DDI modules, pushing up their overall costs as a result.
Source : THE ELEC, Korea Electronics Industry Media(http://thelec.net)
South Korean display equipment maker Hims is aiming to reduce its reliance on OLED equipment this year from sales in new areas. Hims CEO JH Kim said at its shareholders’ meeting that the company has been preparing to enter the semiconductor equipment and software businesses for the past two to three years. These new areas will start contributing sales as early as this year or next year, Kim said. Hims currently rely on OLED equipment for up to 90% of its sales. In 2017, thanks to its major customer Samsung Display investing on its A3 production line dedicated to Apple, Hims recorded 91.4 billion won in sales and 15.6 billion won in operating income. But in 2018, Samsung Display drastically reduced its spending on facilities, which caused Hims sales to decline 60% compared to the previous year. It also turned to an operating loss in the same year.
In 2020, thanks to Samsung Display’s spending on quantum-dot (QD)-OLED panels, Hims sales increased 24.9%. OLED equipment contributed 93.8 billion won in sales, accounting for 88.3% of its total 106.2 billion won sale in that year. Kim said the company recorded its all-time highest sales in 2020 thanks to winning major orders from customers. From December 2019 to January 2020, Hims won orders from Samsung Display, CSoT and Tianma, worth 23.1 billion won, 12 billion won and 16.3 billion won, respectively.
Hims is an exclusive supplier of mask stretcher to Samsung Display. The stretchers are used to stretch the fine metal mask and open masks flat during the OLED deposition process. Kim warned that demand for display equipment this year is concerning compared to 2020 as its customer’s spending plans are uncertain. However, demand for OLED is expected to continue, he said, and as long as the company overcomes uncertainties this year it will be able to secure new opportunities.
Chinese panel companies are likely to spend conservatively this year compared to before to focus on improving their yield rates rather than expanding facilities. Hims' remaining order has dropped at the tail end of 2020 to 14.5 billion won from 64 billion won in 2019. Hims is competing with Hansong Neotech and KPS in orders for mask from China.
The supply of tape COF substrates is expected to fall short of demand in 2021, due to growing COF packaging demand for OLED display driver ICs (DDI) , according to industry sources.
Chinese handset vendors Oppo, Vivo and Xiaomi have turned to COF-processed OLED DDIs, the sources said, and over 50% of OLED DDI chips are expected to adopt COF technology in 2021, significantly adding shipment momentum for Taiwan's tape COF substrate suppliers JMC Electronics and Chipbond Technology, the sources said.
COF technology can process different sizes of DDIs for handsets, notebooks and TVs, and strong demand from terminal markets have enabled backend houses to sustain full capacity utilization while also ramping up shipments of tape COF substrates from suppliers, the sources continued.
Relatively mature COF packaging technology has become top choice for processing both LCD and OLED DDI modules at backend houses despite higher unit cost than COP technology, the sources said, reasoning that poor yield rates for COP process may undermine the entire DDI modules, pushing up their overall costs as a result.
Source : THE ELEC, Korea Electronics Industry Media(http://thelec.net)
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