About LG Display
LG Display Co., Ltd. manufactures thin-film transistor liquid crystal display (TFT-LCD) and organic light-emitting diode (OLED) technology-based display panels in a broad range of sizes and specifications primarily for use in IT products (comprising notebook computers, desktop monitors and tablet computers), televisions and mobile devices, including smartphones. The company is one of the world’s leading suppliers of large-sized OLED television panels. The company also manufactures display panels for industrial and other applications, including entertainment systems, automotive displays, portable navigation devices and medical diagnostic equipment. In 2022, the company sold a total of 126.0 million display panels that are nine inches or larger. The company operates fabrication facilities, which include separately designated sets of fabrication production lines housed in certain facilities, located in the company’s Display Clusters in Gumi and Paju, Korea and in Guangzhou, China. The company also operates module assembly facilities in Korea and abroad. The company seeks to build its market position based on collaborative relationships with the company’s customers and suppliers, a focus on high-end differentiated specialty display products and manufacturing productivity. The company’s end-brand customers include many of the world’s leading manufacturers of IT products, televisions and mobile phones, such as LG Electronics. At the direction of the company’s end-brand customers, the company typically ships its display panels to their original equipment manufacturers, known as ‘system integrators,’ who use the company’s display panels in products they assemble on a contract basis for the company’s end-brand customers. The company engages in direct sales (including through the company’s overseas subsidiaries), as well as indirect sales through trading companies, including the company’s formerly affiliated trading company, LX International and its subsidiaries, to end-brand customers and their system integrators. Pursuant to the separation of certain companies, including LX International, from the LG Group to form a separate business group named the LX Group, which separation was approved by the Korea Fair Trade Commission in June 2022, LX International is no longer the company’s affiliated company. Technology TFT-LCD Technology A TFT-LCD panel consists of two thin glass substrates and polarizer films between which a layer of liquid crystals is deposited and behind which a light source called a backlight unit is mounted. The frontplane glass substrate is fitted with a color filter, while the backplane glass substrate, also called a TFT array, has many thin film transistors, or TFT, formed on its surface. The liquid crystals are normally aligned to allow the polarized light from the backlight unit to pass through the two glass panels. When voltage is applied to the transistors on the TFT array, the liquid crystals change their alignment and alter the amount of light that passes through them. Meanwhile, the color filter on the frontplane glass substrate gives each pixel its own color. The combination of these pixels in different colors and levels of brightness forms the image on the panel. IPS Technology In-Plane Switching, or IPS, is a liquid crystal switching technology that was developed to address commonly faced problems with TFT-LCD panels that utilized other liquid crystal technologies, namely narrow viewing angles, inconsistent picture uniformity and slow response times. Unlike other liquid crystal technologies where the liquid crystals are aligned vertically or at an angle in relation to the glass substrate, with IPS technology, the liquid crystals are aligned horizontally in parallel to the glass substrate, which allows for wider viewing angles, greater picture uniformity and faster response times. The company’s TFT-LCD display panels, including the company’s TFT-LCD television panels, utilize IPS technology. Advanced High Performance IPS, or AH-IPS, is an IPS technology that integrates ultra-fine pitch technology and high transmittance technology, which allows for ultra-high resolution imagery, increased luminance and greater energy efficiency. AH-IPS is utilized in the company’s panels for certain types of IT products, smartphones and other mobile display products. OLED Technology An OLED panel consists of a thin film of organic material encased between anode and cathode electrodes. When a current is applied, light is emitted directly from the organic material. Because a separate backlight is not needed, OLED panels can be lighter and thinner compared to TFT-LCD panels, which require a separate backlight. In addition, images projected on OLED panels have higher contrast ratios and more realistic color reproduction compared to images projected on TFT-LCD panels. The company utilizes different types of sub-pixel and backplane technologies in the company’s OLED panels. Under the RGB sub-pixel structure, a combination of red, green and blue sub-pixels without color filters or white sub-pixels are used to produce a range of colors. While the company, along with most of its competitors, utilize RGB sub-pixel technology for small- and medium-sized products, there are various technical challenges in scaling RGB sub-pixel technology for large-sized products, such as television panels. For the company’s OLED television panels, the company has overcome these challenges by opting to utilize the company’s WRGB sub-pixel structure, whereby red, green and blue color filters are placed over white OLED sub-pixels to produce a range of colors and began production of OLED television panels at the company’s OP1 fabrication facility in 2013. Mass production of the company’s plastic OLED panels for mobile and other applications began at the company’s AP3 and AP4 fabrication facilities in August 2017 and July 2019, respectively. In July 2020, the company commenced mass production of large-sized OLED panels at the company’s CO fabrication facility, located in Guangzhou, China. As for backplane technology, the company’s large-sized OLED products are produced using oxide TFT backplane technology as compared to the company’s smaller-sized OLED products which utilize low-temperature polycrystalline silicon (‘LTPS’), or low-temperature polycrystalline oxide (‘LTPO’), backplane technology. Backplane Technology Oxide TFT The company uses oxide TFT technology to produce backplanes for use in the company’s large-sized OLED panels, such as the panels used in OLED television products. The traditional amorphous silicon-based TFT, or a-Si TFT, backplane technology has certain limitations that render it unsuitable for producing backplanes for use in large-sized OLED panels with high resolutions and fast refresh rates. For example, in larger and higher-resolution display panels, a-Si TFT backplanes consume increased rates of power and experience a decrease in the rate at which each transistor is able to switch between images, or the rate of mobility. As an alternative to a-Si TFT backplane technology, the company has successfully adopted a metal oxide-based TFT, or simply oxide TFT, backplane technology. In place of the amorphous silicon-based semiconductors used in a-Si TFT backplanes, oxide TFT backplanes utilize metal oxide-based semiconductors, which consume less energy, have a higher rate of mobility and allow for construction of display panels with narrower bezels as compared to display panels with traditional a-Si TFT backplanes. The company was the first company in the display industry to successfully adopt oxide TFT technology in large-sized OLED products, which has been a key factor in reducing the costs of manufacturing large-sized OLED panels in large quantities. Because the manufacturing process of oxide TFT-based OLED panels is similar to the process used to manufacture TFT-LCD panels, the company is able to use its existing TFT-based production lines with relatively little modification to mass produce large-sized OLED panels. LTPS and LTPO LTPS backplanes are suitable for use in the production of high-resolution display panels due to their higher mobility rates compared to a-Si TFT or oxide TFT backplanes. As a result, the company generally utilizes LTPS backplanes in the production of small- and medium-sized TFT-LCD panels and OLED smartphone and other applications. The company also uses LTPO backplane technology in its wearable devices and smartphones, which combine elements of both LTPS and oxide TFT technologies to produce backplanes with greater energy savings than LTPS backplanes. Products The company manufactures display panels of various specifications that are integrated by the company’s customers into principally the following products: IT products, which comprise notebook computers (utilizing display panels ranging from 12 inches to 18 inches in size), desktop monitors (utilizing display panels ranging from 15.6 inches to 49 inches in size) and tablet computers (utilizing display panels ranging from 7.85 inches to 12.9 inches in size); Televisions, which utilize large-sized display panels ranging from 23 inches to 98 inches in size, including ‘8K’ Ultra HD television panels, which have four times the number of pixels compared to conventional HD television panels; and Mobile and other applications, which utilize a wide array of display panel sizes, including smartphones and other types of mobile phones and industrial and other applications, such as entertainment systems, automotive displays, portable navigation devices and medical diagnostic equipment. The company designs and manufactures its panels to meet the various size and performance specifications of the company’s customers, including specifications relating to thinness, weight, resolution, color quality, power consumption, response times and viewing angles. The specifications vary from product to product. For television panels, a premium is placed on faster response times, wider viewing angles, higher resolution and greater color fidelity. Notebook computer panels require an emphasis on thinness, light weight and power efficiency, while desktop monitor panels demand a greater focus on brightness, color brilliance, faster response times and wide viewing angles. For mobile panels, particularly smartphones, an emphasis is placed on brightness and power efficiency. In addition to manufacturing and selling display panels, the company manufactures and sells desktop monitors through its joint venture companies. IT Products The company’s panels for IT products comprise display panels for notebook computers (ranging from 12 inches to 18 inches in size), desktop monitors (ranging from 15.6 inches to 49 inches in size) and tablet computers (display panels ranging from 7.85 inches to 12.9 inches in size). In 2022, the company’s principal products in terms of sales revenue in this category included panels of various sizes ranging from 13.3 inches to 16.0 inches for notebook computers, 23.5 inches to 27 inches for desktop monitors and 8.32 inches to 12.9 inches for tablet computers. Televisions The company’s television display panels range from 23 inches to 98 inches in size. In 2022, the company’s principal products in this category in terms of sales revenue consisted of 55-inch and 65-inch display panels. In 2022, the company reduced its production capacity of TFT-LCD panels for televisions at its manufacturing facilities in China and ceased production at, and closed, the company’s P7 facility (where the company had produced TFT-LCD panels for televisions) in December 2022, in light of the company’s continued efforts to increase the proportion of OLED television panels in the company’s product mix and the production capacity for such panels and further reduce the company’s production level of TFT-LCD panels, which is relatively more sensitive to market conditions and generally allow for fewer opportunities for product differentiation. Brand manufacturers of televisions and their distribution channels prefer long-term arrangements with a limited number of display panel suppliers that can offer a full product line, and the company will continue to be well positioned to meet their requirements with the company’s strengths in technology, manufacturing scale and efficiency, as well as the breadth of the company’s product portfolio. Mobile and Other Applications The company’s product portfolio also includes panels for mobile and other applications, which utilize a wide array of display panel sizes, including smartphones and other types of mobile phones and industrial and other applications, including automotive displays, entertainment systems, portable navigation devices and medical diagnostic equipment. Display panels that are nine inches and smaller are referred to as small- and medium-sized panels. Some of the panels the company produces for industrial products, such as medical diagnostic equipment and automotive products, are highly specialized niche products manufactured and designed to the specifications of the company’s clients, while others, such as industrial controllers, may be manufactured by slightly modifying a standard product design for the company’s other products, such as desktop monitors. Display panels for these other applications broaden the company’s sales base and product mix. They are also often a good channel through which the company can commercialize a particular technology that the company has developed. The company focuses on developing large-sized OLED automotive display panels in light of the rapid growth of the electric vehicle market and the development of autonomous driving technology. Sales and Marketing Customer Profile The company’s display panels are included primarily in IT products, televisions and mobile and other applications sold by the company’s global end-brand customers, including LG Electronics. LG Electronics is the company’s largest shareholder. The company negotiates directly with its end-brand customers concerning the terms and conditions of the sales, but typically ship the company’s display panels to designated system integrators at the direction of these end-brand customers. Sales data to end-brand customers include direct sales to these end-brand customers, as well as sales to their designated system integrators, including through the company’s formerly affiliated trading company, LX International, and its subsidiaries. Sales to LG Electronics, including as a system integrator, amounted to approximately 18% of the company’s sales in 2022. In addition to the company’s top ten end-brand customers, the company sells a portion of its display panels to a variety of other manufacturers of computers and electronic products. Sales The company has wholly-owned sales subsidiaries in the United States, Japan, Germany, Taiwan, China and Singapore. The focus of the company’s sales activities is on strengthening the company’s relationships with large end-brand customers, with whom the company maintains strong collaborative relationships. Customers look to the company for a reliable supply of a wide range of display products. The company views its relationships with its end-brand customers as important to their product development strategies, and the company collaborates with its end-brand customers in the design and development stages of their new products. In addition, the company’s sales teams coordinate closely with its end-brand customers’ designated system integrators to ensure timely delivery. The company primarily engages in direct sales (including through its overseas subsidiaries), and to a lesser extent, indirect sales through trading companies and its subsidiaries, to end-brand customers and their system integrators. The company’s sales subsidiaries procure purchase orders from, and distribute the company’s products to, system integrators and end-brand customers located in their region. The company sells its products to trading companies and its subsidiaries. These subsidiaries of trading companies process orders from and distribute products to customers located in their region. The company generally provides a limited warranty to its end-brand customers, including the provision of replacement parts and warranty services for the company’s products. Competition The company’s principal competitors are Samsung Display in Korea; Innolux, AU Optronics and Hannstar in Taiwan; Japan Display and Sharp in Japan; and BOE, China Star Optoelectronics Technology, CEC Panda and HKC in China. Suppliers With respect to glass substrates, Paju Electric Glass Co., Ltd., a joint venture company in which the company owns a 40% equity interest, provides the company with a stable supply at competitive prices. Environmental Matters For the more efficient operation of the company’s waste water treatment equipment, the company has also entered into an agreement with Techcross Environmental Services Inc. for the operation of the company’s water treatment system. Operations at the company’s manufacturing plants are subject to regulation and periodic scheduled and unscheduled on-site inspections by the Korean Ministry of Environment and local environmental protection authorities. The company has adopted adequate anti-pollution measures for the effective maintenance of environmental protection standards consistent with local industry practice, and that the company is in compliance in all material respects with the applicable environmental laws and regulations in Korea, including the Framework Act on Low Carbon, Green Growth, the Korean government, under which the company is required to submit periodic greenhouse gas emission and energy usage statements, performance reports and greenhouse gas emission and energy usage reduction plans to the Korean government. As part of the company’s efforts to establish and operate environmental-friendly energy management systems at the company’s domestic and overseas fabrication facilities and production plants, the company has received from the International Organization for Standardization ISO 14001 certification for each of the company’s domestic and overseas production sites and ISO 50001 certification for all of the company’s domestic and several of the company’s overseas subsidiaries with respect to its energy management systems. The company’s overseas subsidiary in Yantai earned Platinum Zero Waste to Landfill (‘ZWTL’) validation in 2021, and all of the company’s domestic production facilities earned Gold ZWTL validation, and the company’s overseas subsidiary in Nanjing earned Platinum ZWTL validation in 2022. Joint Ventures in September 2012, the company entered into a joint venture agreement with Guangzhou GET Technologies Development Co., Ltd., or GET Tech, and Shenzhen SKYWORTH-RGB Electronic Co., Ltd., or Skyworth, establishing LG Display (China) Co., Ltd., which owns and operates the company’s CA fabrication facility in Guangzhou, China. The company owns a 70.0% equity interest in LG Display (China). Each of GET Tech and Skyworth owns a 20.0% and 10.0% equity interest in LG Display (China), respectively. In addition, in July 2018, the company established and acquired a 69% ownership interest in a joint venture with the government of Guangzhou, LG Display High-Tech (China) Co., Ltd., to construct the company’s new CO fabrication facility to manufacture next generation large-sized OLED panels in Guangzhou, China. The company owns a 70% equity interest in LG Display High-Tech (China), and the company commenced mass production of large-sized OLED panels at the CO fabrication facility in July 2020. Research and Development The company’s research and development expenses were W1,382 billion (U.S.$1,097 million) in 2022. History The company was founded in 1985. It was incorporated in 1985 under the laws of the Republic of Korea. The company was formerly known as LG Soft, Ltd. and changed its name to LG LCD Co., Ltd. in 1998 and then to LG.Philips LCD Co., Ltd. in 1999. Further, the company changed its name to LG Display Co., Ltd. in 2008.
