02.27.23
Universal Display reported financial results for the fourth quarter and full year ended Dec. 31, 2022.
“We ended 2022 strongly with record revenues and earnings,” said Brian Millard, VP and CFO of Universal Display Corporation. “As we look to 2023, while macro uncertainties per-sist, we are continuing to build upon our leadership position in the OLED ecosystem. This includes continued discovery and development of next-generation phosphorescent mate-rials, progress on the development of our commercial phosphorescent blue and ground-breaking OVJP (organic vapor jet printing) manufacturing platform, as well as investing in our infrastructure and capabilities. We believe that these initiatives and the industry’s advancing roadmap for medium- and large-area OLED displays are setting the stage for 2024 to be a pivotal year for the commencement of a new OLED adoption cycle and in-vestment wave.”
Financial Highlights for the Fourth Quarter of 2022
• Total revenue in the fourth quarter of 2022 was $169 million as compared to $146.2 million in the fourth quarter of 2021. Universal Display continues to expect the near-term weakness in the overall global market economy to have an impact on forecasted demand for OLED products utilizing emitter material over the remaining life of certain customers’ contracts compared to prior estimates.
• Revenue from material sales was $88.3 million in the fourth quarter of 2022 as compared to $85.8 million in the fourth quarter of 2021. This increase was primarily the re-sult of higher unit volume.
• Revenue from royalty and license fees was $75.6 million in the fourth quarter of 2022 as compared to $56 million in the fourth quarter of 2021. The increase was primarily due to the cumulative catch-up adjustment as well as higher unit material volume.
• Cost of material sales was $26.6 million in the fourth quarter of 2022 as compared to $29.2 million in the fourth quarter of 2021. Fourth quarter cost of material sales de-creased due to favorable product mix, partially offset by underutilization costs associated with the manufacturing facility in Shannon, Ireland, which commenced manufacturing in mid-2022.
• Total gross margin was 82% in the fourth quarter of 2022 as compared to 78% in the fourth quarter of 2021.
• Operating income was $83.1 million in the fourth quarter of 2022 as compared to $56.5 million in the fourth quarter of 2021.
• Net income was $65.1 million or $1.36 per diluted share in the fourth quarter of 2022 as compared to $45.9 million or $0.96 per diluted share in the fourth quarter of 2021.
Financial Highlights for the Full Year 2022
• Total revenue for the full year 2022 was $616.6 million as compared to $553.5 million for the full year 2021. Universal Display continues to expect the near-term weakness in the overall global market economy to have an impact on forecasted demand for OLED products utilizing emitter material over the remaining life of certain customers’ contracts compared to prior estimates.
• Revenue from material sales was $331.1 million for the full year 2022 as compared to $318.6 million for the full year 2021. This increase was primarily the result of higher unit volume.
• Revenue from royalty and license fees was $267.1 million for the full year 2022 as com-pared to $219.0 million for the full year 2021. The increase was primarily due to the cu-mulative catch-up adjustment as well as higher unit material volume.
• Cost of material sales was $115.6 million for the full year 2022 as compared to $104.4 million for the full year 2021. The increase was due to higher unit material volumes as well as underutilization costs associated with the Shannon facility in the full year 2022 of $7.9 million.
• Total gross margin was 79% for both the full years 2022 and 2021.
• Operating income was $267.1 million for the full year 2022 as compared to $227.6 mil-lion for the full year 2021.
• Net income was $210.1 million or $4.40 per diluted share for the full year 2022 as com-pared to $184.2 million or $3.87 per diluted share for the full year 2021.
The company believes that its 2023 revenue will be the range of $550 million to $600 mil-lion. The OLED industry remains at a stage where many variables can have a material im-pact on results, and the company thus caveats its financial guidance accordingly.
“We ended 2022 strongly with record revenues and earnings,” said Brian Millard, VP and CFO of Universal Display Corporation. “As we look to 2023, while macro uncertainties per-sist, we are continuing to build upon our leadership position in the OLED ecosystem. This includes continued discovery and development of next-generation phosphorescent mate-rials, progress on the development of our commercial phosphorescent blue and ground-breaking OVJP (organic vapor jet printing) manufacturing platform, as well as investing in our infrastructure and capabilities. We believe that these initiatives and the industry’s advancing roadmap for medium- and large-area OLED displays are setting the stage for 2024 to be a pivotal year for the commencement of a new OLED adoption cycle and in-vestment wave.”
Financial Highlights for the Fourth Quarter of 2022
• Total revenue in the fourth quarter of 2022 was $169 million as compared to $146.2 million in the fourth quarter of 2021. Universal Display continues to expect the near-term weakness in the overall global market economy to have an impact on forecasted demand for OLED products utilizing emitter material over the remaining life of certain customers’ contracts compared to prior estimates.
• Revenue from material sales was $88.3 million in the fourth quarter of 2022 as compared to $85.8 million in the fourth quarter of 2021. This increase was primarily the re-sult of higher unit volume.
• Revenue from royalty and license fees was $75.6 million in the fourth quarter of 2022 as compared to $56 million in the fourth quarter of 2021. The increase was primarily due to the cumulative catch-up adjustment as well as higher unit material volume.
• Cost of material sales was $26.6 million in the fourth quarter of 2022 as compared to $29.2 million in the fourth quarter of 2021. Fourth quarter cost of material sales de-creased due to favorable product mix, partially offset by underutilization costs associated with the manufacturing facility in Shannon, Ireland, which commenced manufacturing in mid-2022.
• Total gross margin was 82% in the fourth quarter of 2022 as compared to 78% in the fourth quarter of 2021.
• Operating income was $83.1 million in the fourth quarter of 2022 as compared to $56.5 million in the fourth quarter of 2021.
• Net income was $65.1 million or $1.36 per diluted share in the fourth quarter of 2022 as compared to $45.9 million or $0.96 per diluted share in the fourth quarter of 2021.
Financial Highlights for the Full Year 2022
• Total revenue for the full year 2022 was $616.6 million as compared to $553.5 million for the full year 2021. Universal Display continues to expect the near-term weakness in the overall global market economy to have an impact on forecasted demand for OLED products utilizing emitter material over the remaining life of certain customers’ contracts compared to prior estimates.
• Revenue from material sales was $331.1 million for the full year 2022 as compared to $318.6 million for the full year 2021. This increase was primarily the result of higher unit volume.
• Revenue from royalty and license fees was $267.1 million for the full year 2022 as com-pared to $219.0 million for the full year 2021. The increase was primarily due to the cu-mulative catch-up adjustment as well as higher unit material volume.
• Cost of material sales was $115.6 million for the full year 2022 as compared to $104.4 million for the full year 2021. The increase was due to higher unit material volumes as well as underutilization costs associated with the Shannon facility in the full year 2022 of $7.9 million.
• Total gross margin was 79% for both the full years 2022 and 2021.
• Operating income was $267.1 million for the full year 2022 as compared to $227.6 mil-lion for the full year 2021.
• Net income was $210.1 million or $4.40 per diluted share for the full year 2022 as com-pared to $184.2 million or $3.87 per diluted share for the full year 2021.
The company believes that its 2023 revenue will be the range of $550 million to $600 mil-lion. The OLED industry remains at a stage where many variables can have a material im-pact on results, and the company thus caveats its financial guidance accordingly.