Samsung TV with stagnant profits... Will OLED bring a new phase?

QD-OLED Launch Expected Within Q1
CE Division Operating Profit in Q4 Last Year Estimated at 200-300 Billion KRW
Potential Collaboration with LG Display Emerges

[Asia Economy Reporter Han Ye-ju] Samsung Electronics is set to fully ramp up production of organic light-emitting diode (OLED) TVs for the first time in 10 years. OLED has been chosen as a new weapon to overcome the stagnation in the TV market, where profitability has plateaued. The possibility of panel collaboration with LG Display is also resurfacing.

Samsung Electronics recently completed the radio certification conformity evaluation registration for 55-inch (KQ55SC95A) and 65-inch (KQ65SC95A) OLED TVs at the National Radio Research Agency one after another. Devices that have passed conformity evaluation are generally considered products close to release, with only price and distribution adjustments remaining. Industry insiders expect Samsung to launch Quantum Dot (QD)-OLED TVs within the first quarter after product certification registration.

This marks Samsung Electronics’ return to the domestic OLED TV market after 10 years. Samsung first introduced a 55-inch OLED TV domestically in 2013, but under Vice Chairman Han Jong-hee, who was then head of the Visual Display Business Division, the company decided not to pursue the OLED TV business due to concerns over burn-in issues, halting production.

Samsung Electronics QD-OLED 55-inch. [Photo by Samsung Electronics]

Samsung Electronics’ re-entry into the OLED TV market reflects a sense of crisis in the global TV market. Amid consumer downturns and declining TV purchase rates, the strategy is interpreted as an effort to strengthen profitability by focusing on premium segment products, which have relatively steady demand. Although the flagship Neo QLED product line leads the premium segment, the TV market is showing signs of generational change, with LCD TV panels declining and OLED panel shipments gradually increasing.

In fact, the profitability of Samsung Electronics’ TV business has sharply declined. According to Samsung’s preliminary earnings announcement, the CE division, responsible for home appliances and TVs, is estimated to have posted operating profits in the range of 200 to 300 billion KRW in the fourth quarter of last year, less than half compared to the previous year.

Another reason Samsung is challenging OLED TVs again is the improvement in Samsung Display’s QD-OLED panel yield, which has approached 90%. Samsung Display unveiled the world’s first large 77-inch QD-OLED TV at this year’s CES.

However, Samsung has also left open the possibility of OLED collaboration with LG Display. Although Samsung Display’s panel yield has improved significantly, the overall production volume still does not fully meet Samsung Electronics’ desired quantity. At the 'Samsung First Look 2023' event held at CES 2023, the 77-inch QD-OLED was exhibited without the term QD, labeled simply as OLED 77-inch.

Vice Chairman Han Jong-hee has consistently maintained that "the OLED alliance is always open." At CES 2023, Han said, "The market had cooled down due to difficulties but is now at a stage of restarting," adding, "We are always open, and there is plenty of potential."

Meanwhile, Samsung Electronics does not plan to completely shift the focus of its TV business to OLED. The company intends to continue concentrating on QLED products, which still offer good productivity. Samsung also unveiled numerous new products, including the 2023 model 8K 98-inch QLED TV.