Supply chain
Digitimes Research: Korea touch panel makers see revenue declines in 1H14 as Samsung reduces purchases
Ricky Tu, DIGITIMES Research, Taipei

Korea-based touch panel makers Iljin Display, Melfas, Smart Mobile Application Company (SMAC) and Taeyang Electronics all saw revenue declines in the first half of 2014 as Korea-based vendors shifted orders to touch panel makers abroad due to cheaper pricing, as well as developing more in-house solutions.

Melfas and SMAC saw the biggest drops at over 50% as Samsung Electronics shifted orders. Melfas supplied 68% of handset touch panels to Samsung in 2013 but that number dropped to 57% in the first half of 2014. Digitimes Research found that Samsung reduced its spending on purchasing touch panels from non in-house makers from US$2.3 billion in 2013 to an estimated US$1.6 billion in 2014.

The four companies, in addition to Electro Luminescence Korea (ELK), supplied roughly 40% of tablet touch panels to Samsung during the first half, dropping 20pp on year. However, Samsung's total purchases of touch panel solutions used in tablets is estimated to remain flat on year in 2014 at US$1.2 billion.

The Korea makers' accumulative revenue proportion from sales to Samsung dropped to just under 52% in the second quarter of 2014, down from over 70% in first-quarter 2012, noted Digitimes Research.

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