About Universal Display

Universal Display Corporation is a leader in the research, development and commercialization of organic light emitting diode (OLED) technologies and materials for use in display and solid-state lighting applications. The company has established a significant portfolio of proprietary OLED technologies and materials, primarily through its internal research and development efforts and acquisitions of patents and patent applications, as well as maintaining long-standing, and establishing new relationships with world-class universities, research institutions and strategic manufacturing partnerships. The company owns, exclusively license or have the sole right to sublicense more than 6,000 patents issued and pending worldwide. The company manufactures and sells its proprietary OLED materials to customers for evaluation and use in commercial OLED products. The company also enters into agreements with manufacturers of OLED display and lighting products under which it grants them licenses to practice under its patents and to use its proprietary know-how. The company works with these and other companies that are evaluating its OLED material, device design and manufacturing technologies for possible use in commercial OLED display and lighting products. Broad Portfolio of Intellectual Property Generally, each of the company's commercial offerings is protected by multiple patents which can help it either to prevent or combat the introduction of counterfeit and/or knock-off products that could potentially impact the market demand for its OLED materials and technologies. The company's strong patent and non-patented know-how portfolios in the areas of PHOLED emitter materials, complementary PHOLED materials, OLED device designs, and OLED manufacturing technologies are reflective of its continued commitment to innovate and invest. Through its internal development efforts, acquisitions, and long-standing relationships with academic partners, research institutions and product manufacturers, the company owns, exclusively license or has the sole right to sublicense more than 6,000 patents issued and pending worldwide. The company continues to enhance and grow its OLED technology and materials patent portfolio organically through internal research and development, partnering with third parties, and by acquisition. The company also continues to accumulate valuable non-patented technical know-how relating to its OLED technologies and materials. Leading Supplier of UniversalPHOLED Emitter Materials and Related Technology Licensing The company is the leading supplier of PHOLED emitter materials to OLED device manufacturers. The emitter material, which is designed to efficiently convert electrical energy to a desired wavelength of light, is the key component in an OLED device. The company's manufacturing partner of over 20 years, PPG, continues to manufacture its materials for it, using proprietary manufacturing processes and know-how, which materials it then qualify to its exacting product specifications and resell on a just-in-time basis to OLED device manufacturers. The company records revenues based on its sales of these materials to OLED device manufacturers. The company's commercial supply agreements typically require its customers to purchase minimum quantities of its materials, which purchases can be in the form of annual minimum purchase undertakings or as a minimum percentage of their purchase requirements, or a combination of both. The company's commercial supply arrangements allow it to maintain close technical and business relationships with these OLED device manufacturers purchasing its proprietary materials, and thereby further supports its technology licensing business. Complementary UniversalPHOLED Host Material Business In addition to its proprietary UniversalPHOLED emitter materials, the company continues to develop, supply and offer for sale certain of its proprietary phosphorescent host materials to OLED device manufacturers. In addition, the company has entered into a number of host material strategic partnerships through development agreements with OLED material partners that are focused on combining its proprietary PHOLED emitters with hosts and other OLED materials of these companies in order to optimize the performance of its emitters in its customers' newest product designs. Business Strategy The company's primary business strategy is to develop new OLED materials and sell existing and new materials to product manufacturers for display applications, such as mobile phones, televisions, monitors, wearables, tablets, portable media devices, notebook computers, personal computers and automotive applications, and specialty and general lighting products; and further develop and either license or otherwise commercialize its proprietary OLED material, device design and manufacturing technologies to those manufacturers The company's current business strategy is to continue to promote and expand its portfolio of OLED technologies and materials for widespread use in OLED displays and lighting products. The company generates revenues primarily by selling its proprietary OLED materials and licensing its OLED technologies to display and lighting product manufacturers. The key elements of the company's strategy are to expand its collaborative relationships with leading product manufacturers and developers; enhance its existing portfolio of PHOLED technologies and materials; and develop next-generation organic technologies. Business and Geographic Markets The company derives revenue from the following: sales of OLED materials for evaluation, development and commercial manufacturing; intellectual property and technology licensing; technology development and support, including third-party collaboration efforts and providing support to third parties for commercialization of their OLED products; and contract research services in the areas of chemical synthesis research, development and commercialization for non-OLED applications. Most manufacturers of displays and lighting products who are or might potentially be interested in the company's OLED technologies and materials are located outside of the United States, particularly in the Asia-Pacific region. To provide on-the-ground support to these manufacturers, the company has established wholly-owned subsidiaries in Ireland, Korea, Japan, China and Hong Kong, as well as a representative office in Taiwan. The company has Application Centers in Hong Kong and Pangyo, South Korea, which allow its Asia-based display manufacturers to evaluate its technology more quickly and incorporate the technology into their commercial designs. The company's wholly-owned subsidiary formed under the laws of the Republic of Ireland, UDC Ireland Ltd. (UDC Ireland), is responsible for all material sales worldwide (excluding the United States) and for licensing and managing intellectual property and undertaking certain other business transactions in all non-U.S. territories. In 2023, the company received a majority of its revenue from three customers domiciled in the Asia-Pacific region, BOE, LG Display and SDC, from each of which it had revenue in excess of 10% of its consolidated revenue. The company generally enters into long-term agreements with its customers, which may include a commercial supply agreement for the purchase of specific OLED materials, and patent and know-how license agreements that relate to the manufacture of display and lighting devices. The company's patent and know-how license agreements generally are made available to its customers for the manufacture of OLED devices. In addition, the company may license to certain material company partners the right to manufacture certain OLED materials that are complementary to its phosphorescent emitter materials. These licenses have included licenses to make host products and certain other non-phosphorescent materials. Technology and its Relation to OLED Technology and Structure OLED devices are solid-state semiconductor devices made from thin films of organic material that emit light of various wavelengths when electricity is selectively applied to the emissive layer of the device. OLED devices are typically referred to as incorporating an OLED stack. OLED stacks vary in specific structure but those commonly used today may include a cathode, an electron injection layer, an electron transport layer, an emissive layer, a hole transport layer, a hole injection layer and an anode, all of which are placed on a substrate which may be made of a number of different materials, including glass, plastic and metal. The company's technology and materials are most commonly utilized in the emissive layer; the materials in the emissive layer are the light-generating component of the OLED stack. Many of the company's key technologies relate primarily to phosphorescent emitter materials, which are more energy efficient than fluorescent emitter materials that can also be used to generate light within the emissive layer of the OLED device. The company began selling emitter materials commercially in 2003. A manufacturer will use a small amount of emitter material for each device through a process called doping into a host material. The emitter material(s) and the host material(s) together form an emissive layer system. Depending on the nature of the OLED device, the emissive materials and emissive layer system may be designed to emit different colors. The company has commercially produced and sold phosphorescent emitter materials that produce red, yellow, green and light-blue light, which are combined in various ways for the display and lighting markets. The company's materials business, conducted outside the United States by UDC Ireland, focuses primarily on the delivery of such emissive materials. The company has also developed host materials for the emissive layer and began selling them commercially in 2011. In addition to its materials, which are generally protected by patents covering various molecular structures, the company has system and process patents that cover various fundamentally important aspects of the OLED device, device architectures, use of materials in devices and OLED manufacturing processes. PHOLED Technologies PHOLED technologies utilize specialized materials and device structures that allow OLEDs to emit light through a process known as phosphorescence. Traditional fluorescent OLEDs emit light through an inherently less efficient process. Theory and experiment show that PHOLEDs exhibit device efficiencies up to four times higher than those exhibited by fluorescent OLEDs. Phosphorescence substantially reduces the power requirements of an OLED and is useful in displays for hand-held devices, such as smartphones, where battery power is often a limiting factor. The company has a strong intellectual property portfolio surrounding its existing PHOLED technologies and materials for both displays and lighting products which it markets under the UniversalPHOLED brand. The company devotes a substantial portion of its efforts to developing new and improved proprietary PHOLED materials and device architectures for red, green, yellow, blue and white OLED devices. In 2023, the company continued its commercial supply relationships with companies, such as BOE, CSOT, LG Display, SDC, Tianma, and Visionox to use its PHOLED materials to manufacture OLED displays. In addition, the company has worked and continue to work closely with customers evaluating and qualifying its proprietary PHOLED materials for commercial usage in both displays and lighting products, and with other material suppliers to combine its PHOLED emitters with their phosphorescent hosts and other OLED materials. Additional Proprietary OLED Technologies The company's intellectual property, research, development and commercialization efforts also encompass a number of other OLED device and manufacturing technologies, including, but not limited to, the following: FOLED Flexible OLEDs The company is working on a number of technologies required for the fabrication of OLEDs on flexible substrates. Most other flat panel displays are built on rigid glass substrates. In contrast, FOLEDs are OLEDs built on non-rigid substrates such as plastic or metal foil. This has the potential to enhance durability and enable conformation to certain shapes or repeated bending or flexing. Many OLED smartphone displays are built on plastic substrates including those produced by SDC and LG Display. Several of the company's customers demonstrated different foldable and rollable FOLED displays at recent Consumer Electronics Shows in Las Vegas, NV. The commercial introduction of such FOLED product offerings demonstrates the viability of new display product applications, such as portable, roll-up communications televisions, tablets, notebook computers and smartphones, as well as enhances the usefulness of such devices in ruggedized, industrial and wearable computing systems. Manufacturers also may be able to produce FOLEDs using more efficient continuous, or roll-to-roll, processing methods in the future. The company's internal research and development efforts are expected to enhance and promote the future adoption of consumer and industrial FOLED devices. OVJP Organic Vapor Jet Printing OLEDs could be manufactured using other processes as well, including OVJP. As a direct printing technique, OVJP technology has the potential to offer high deposition rates for large-area OLEDs. In addition, OVJP technology reduces OLED material waste associated with use of a shadow mask (i.e., the waste of material that deposits on the shadow mask itself when fabricating an OLED). By comparison to inkjet printing, an OVJP process does not use liquid solvents and therefore the OLED materials utilized are not limited by their viscosity or solvent solubility. OVJP also avoids generation of solvent wastes and eliminates the additional step of removing residual solvent from the OLED device. In 2019, the company installed a red-green-blue OVJP pilot tool at its Ewing, New Jersey facility, and it continues to collaborate on OVJP technology development with Professor Forrest of Michigan. In June 2020, the company formed a wholly-owned subsidiary, OVJP Corporation (OVJP Corp), as a Delaware corporation. Based in California, OVJP Corp was founded to advance the commercialization of its proprietary OVJP technology. As of December 31, 2023, OVJP Corp employed a team of 28 research, mechanical, electrical and software engineers and laboratory technicians. Strategic Relationships with Product Manufacturers The company has established early-stage evaluation programs, development and pre-commercial programs, and commercial arrangements with a substantial number of manufacturers or potential manufacturers of OLED display and lighting products. Many of these relationships are directed towards tailoring the company's proprietary OLED technologies and materials for use by individual manufacturers. Relationships with OLED Display Manufacturers The company licenses its OLED technologies and patents to display manufacturers for use in commercial products and supply its proprietary OLED materials to these manufacturers for both commercial use and evaluative purposes. The company has been collaborating with some of these display manufacturers for over 20 years. The company has been working with SDC and providing its PHOLED materials to SDC for evaluation since 2001. Under the terms of a patent license agreement, it licenses its patents and technologies to SDC for its manufacture and sale of AMOLED (active-matrix organic light-emitting diode) display products. Under the terms of a supplemental purchase agreement, the company supplies its proprietary PHOLED materials to SDC for its use in manufacturing licensed products. The company also continues to supply SDC with its proprietary UniversalPHOLED materials for use in its development efforts under a 2001 joint development agreement. On December 2, 2022, the company entered into new patent license and supplemental purchase agreements with SDC, both with an effective date of January 1, 2023. These agreements, which cover the manufacture and sale of specified OLED display materials, last through the end of 2027 with an additional two-year extension option for SDC. Under these agreements, the company is being paid a license fee, which includes quarterly and annual payments over the agreement term of five years. These agreements convey to SDC the non-exclusive right to use certain of the company's intellectual property assets for a limited period of time that is less than the estimated life of the assets. The supplemental purchase agreement provides for minimum annual purchase obligations of red and green phosphorescent emitter material from the company for use in the manufacture of licensed products. The minimum commitment is subject to SDC's requirements for phosphorescent emitter materials and the company's ability to meet these requirements over the term of the supplemental agreement. SDC is the largest manufacturer of AMOLED displays for smartphones and other personal electronic devices and produces displays for a number of different smartphone and electronic device manufacturers. In 2015, the company entered into an OLED patent license agreement and an OLED commercial supply agreement with LG Display, which were effective as of January 1, 2015. The terms of these agreements were extended by a January 1, 2021 amendment through the end of 2025. The patent license agreement provides LG Display a non-exclusive, royalty bearing portfolio license to make and sell OLED displays under its patent portfolio. The patent license calls for license fees, prepaid royalties and running royalties on licensed products. The OLED commercial supply agreement provides for the sales of materials for use by LG Display, which may include phosphorescent emitters and host materials. The agreements provide for certain other minimum obligations relating to the volume of material sales anticipated over the life of the agreements as well as minimum royalty revenue. LG Display is the largest manufacturer of AMOLED displays for large-area televisions and produces display panels for a number of different television manufacturers. In 2023, the company entered into new long-term, multi-year agreements with BOE. Under these agreements, the company has granted BOE non-exclusive license rights under various patents owned or controlled by it to manufacture and sell OLED display products. The company also supplies phosphorescent OLED materials to BOE for use in its licensed products. In 2019, the company entered into an evaluation and commercial supply relationship with CSOT. In 2020, the company entered into long-term, multi-year agreements with CSOT. Under these agreements, the company has granted CSOT non-exclusive license rights under various patents owned or controlled by it to manufacture and sell OLED display products. The company also supplies phosphorescent OLED materials to CSOT for use in its licensed products. In 2018, the company entered into long-term, multi-year OLED patent license and material purchase agreements with Visionox. Under the license agreement, it has granted certain of Visionox's affiliates non-exclusive license rights under various patents owned or controlled by it to manufacture and sell OLED display products. The license agreement calls for license fees and running royalties on licensed products. Additionally, the company supplies phosphorescent OLED materials to Visionox for use in its licensed products. In 2021, the company announced an extension of the Visionox agreement by entering into new five-year OLED material supply and license agreements with a new affiliate of Visionox, Visionox Hefei Technology Co. Ltd. In 2016, the company entered into long-term, multi-year OLED patent license and material purchase agreements with Tianma. Under the license agreement, it has granted Tianma non-exclusive license rights under various patents owned or controlled by it to manufacture and sell OLED display products. The license agreement calls for license fees and running royalties on Tianma's sales of licensed products. Additionally, the company supplies phosphorescent OLED materials to Tianma for use in its licensed products. In 2021, the company mutually agreed to extend the terms of both the patent license and material purchase agreements for an additional multi-year term. The company has been collaborating with AU Optronics since 2001, and it continues to provide its proprietary PHOLED materials to AU Optronics under a 2016 commercial supply agreement through which AU Optronics also has certain license rights. The company also continues to support numerous display manufacturers in their evaluation of its technologies and proprietary OLED materials, through evaluation arrangements in which it provides proprietary OLED materials to such manufacturers for limited scale commercial production, evaluation and for purposes of development, manufacturing qualification and product testing. Many of these strategic relationships have been in place for longer than a decade, and the company continues to establish new relationships. Relationships with OLED Lighting Manufacturers The company licenses its OLED technologies and patents to lighting manufacturers for use in commercial products and supply its proprietary OLED materials to these manufacturers for both commercial use and evaluative purposes. Some of these strategic relationships have also been in place for longer than a decade. The company continues to license its OLED patents, and to provide its OLED materials, to OLEDWorks for use in OLED lighting products under patent license and commercial supply agreements signed in 2015. The company has also extended the rights under these agreements to OLEDWorks GmbH, the German company and facility that OLEDWorks acquired in 2015 from Philips Technologie GmbH. The company also has strategic relationships with Kaneka, Konica Minolta and Sumitomo, and continue to license its OLED patents and technologies to these customers. Similar to its arrangements with display manufacturers, the company continues to support numerous lighting manufacturers in their evaluation of its technologies and proprietary OLED materials, typically through evaluation agreements under which it provides its proprietary OLED materials to such manufacturers for evaluation and potential commercial application. Relationships with Manufacturers for Other Commercial Products In addition to its relationships with lighting and display manufacturers, the company has agreements and arrangements with manufacturers or potential manufacturers to use its proprietary OLED technologies and materials in other commercial products, such as in automotive interiors and exteriors. OLED Materials Manufacturing Business The company supplies its proprietary UniversalPHOLED materials to display manufacturers, lighting manufacturers and others. These materials are produced in batch quantities by PPG to the company's exacting product specifications using its manufacturing process and know-how. The company qualifies each batch of emitters at its device qualification facilities to ensure that they meet required specifications, and it stores qualified product inventory for delivery to its customers. In 2023, the company completed successful Surveillance Audits on its ISO 9001:2015 Quality Management Systems, its ISO 14001:2015 Environmental Management Systems, and its ISO 45001:2018 Occupational Health and Safety Management Systems. PPG The company has an agreement with PPG, the term of which, by amendment in February 2021, continues through December 31, 2024, and thereafter is automatically renewed for additional one-year terms, unless terminated by it with prior notice of one year or terminated by PPG with prior notice of two years. Through its collaboration with PPG, key raw materials are sourced from multiple suppliers to ensure that the company is able to meet the needs of its customers on a timely basis. In February 2021, the company entered into an amendment to the PPG agreement extending the term of the agreement and specifying operation and maintenance services that will be provided by PPG affiliate, PPG SCM Ireland Limited (PPG SCM), to UDC Ireland at its manufacturing site in Shannon, Ireland, which it began leasing at such time for the production of its OLED materials. The company purchased the site in September 2023 and amended and restated the February 2021 amendment to the PPG agreement to reflect its ownership and PPG SCM's updated operation and maintenance services after such purchase. When fully operational, the facility is expected to double the company's production capacity and allow for the diversification of its manufacturing base for phosphorescent emitters. The first phase of facility improvements has been completed and operations commenced in June 2022. Collaborations with Other OLED Material Manufacturers The company continued its non-exclusive collaborative relationships with OLED material manufacturing customers during 2023. Most of these relationships are focused on combining its proprietary PHOLED emitters with hosts and other OLED materials of these companies in an effort to optimize the company's PHOLED emitter products and deliver a high-performance system to the end customer. Research and Development The company has long-standing relationships with Princeton University (Princeton) and USC for the conduct of research relating to its OLED and other organic thin-film technologies and materials for applications, such as displays and lighting. The company's research and development expenses were $130.5 million for the year ended December 31, 2023. Intellectual Property Patents As of December 31, 2023, the company owned more than 6,000 unexpired issued patents and pending patent applications around the world in addition to the hundreds of patents and patent applications it exclusively license from its research partners. Patents License from Research Partners The company exclusively licenses patent rights from a number of university research partners. Generally, the company sponsors scientific researchers at universities to undertake pre-defined research programs, and in exchange it receives license rights to patents that may be developed under the programs. As of December 31, 2023, the patent rights the company exclusively licensed from all its university research partners included more than 626 issued patents and pending patent applications in jurisdictions around the world. Under its university patent license agreements, the company generally frees to sublicense to third parties all or any portion of the licensed patent rights for the life of the licensed patents, though its rights are subject to termination for an uncured material breach or default by it, or if it become bankrupt or insolvent. As part of its university license agreements, the company may be required to compensate the universities to the extent it, or its sublicensees, utilize the licensed technology in commercial products. Under the 1997 Amended License Agreement the company is required to pay Princeton royalties for licensed products sold by it or its sublicensees. Acquired Patents and Other Intellectual Property From time to time, the company acquires patents and other intellectual property that provides strategic business opportunities, such as the patent and technology portfolio it acquired from Motorola Solutions, Inc. (Motorola) in 2011, and the following portfolios from Fujifilm Corporation, BASF, and Merck KGaA: Patents Acquired from Fujifilm Corporation In 2012, the company entered into a Patent Sale Agreement (the Fujifilm Agreement) with Fujifilm. Under the Fujifilm Agreement, Fujifilm sold more than 1,200 OLED-related patents and patent applications. The Fujifilm Agreement contains customary representations and warranties and covenants, including respective covenants not to sue by both parties thereto. The Fujifilm Agreement permitted the company to assign all of its rights and obligations under the Fujifilm Agreement to its affiliates, and it assigned, prior to the consummation of the transactions contemplated by the Fujifilm Agreement, its rights and obligations to UDC Ireland. The transactions contemplated by the Fujifilm Agreement were consummated on July 26, 2012. Patents Acquired from BASF In 2016, UDC Ireland entered into an IP Transfer Agreement (the BASF Agreement) with BASF. Under the BASF Agreement, BASF sold the company more than 500 OLED-related patents and patent applications. The transactions contemplated by the BASF Agreement were consummated on June 28, 2016. Patents Acquired from Merck KGaA In 2023, UDC Ireland entered into a Patent Sale and License Agreement with Merck KGaA. Under this agreement, Merck KGaA sold to UDC Ireland all of its rights, title and interest to over 550 of its owned and licensed OLED-related patents and patent applications. The transactions contemplated by the Merck KGaA Agreement were consummated on April 28, 2023. Customers The company has long-standing customer relationships with OLED device manufacturers that are using, or are evaluating for use, its OLED materials in commercial OLED products. The company has a proven track record of delivering consistent, high-quality OLED material to its customers. The company provides just-in-time supply to its customers and serve as a sole source to them for many of its critical materials. The company's unparalleled manufacturing partners, namely PPG, its well-established supply chain, its multi-tier quality testing, and its product assurance protocols make it a preferred partner for its customers and for any large-scale OLED display manufacturer that wants to deliver to high-quality international end-customers. In 2023, the company's largest customers for its PHOLED materials included Samsung Display Co., Ltd. (SDC), LG Display Co., Ltd. (LG Display), BOE Technology Group Co., Ltd. (BOE), Tianma Micro-electronics Co., Ltd. (Tianma), Visionox Technology, Inc. (Visionox), Wuhan China Star Optoelectronics Semiconductor Display Technology Co., Ltd. (CSOT), Japan Display, Inc., Sharp Corporation, and AU Optronics Corporation (AU Optronics). Other licensed customers of its technology in 2023 included Kaneka Corporation, Pioneer Corporation, and OLEDWorks L.L.C. Competition Other material manufacturers, such as Sumitomo, Idemitsu Kosan Co., Ltd. (Idemitsu Kosan), Merck KGaA, Kyulux Inc., Summer Sprout Technology, UIV OLED, Aglaia Tech, Jilin OLED Photoelectric Materials Co., Ltd., and Nanjing Topto Semiconductor Materials Co., Ltd. are selling or sampling competing OLED materials to customers, including companies to which the company sells its proprietary PHOLED materials. History Universal Display Corporation was founded under the laws of the Commonwealth of Pennsylvania in 1985. The company was incorporated in 1985.