Display demand is expected to return to normal levels in 2023 with the easing of inflation and the end of demand restraint.

Omdia, in its recently released mid- to long-term display demand forecast report, forecasted that display area demand will increase by 6.2% year-on-year in 2023.

As inflation eases, interest rate hikes slow, and the demand slump ends, display demand is expected to return to normal levels in the second half of 2023.

Earlier this year, display demand in 2022 was expected to be below normal, reflecting the positive impact of COVID-19. Now, display demand is projected to decline even more sharply, falling 6.9% year-over-year, amidst global inflation, supply chain disruptions, and an energy crisis fueled by rising raw material prices. As a result, 2022 is predicted to be the first year in the history of flat panel displays where area demand will decline.

On the other hand, Ricky Park, director of display research at Omdia, said that if global inflation slows and there are signs that the economy has bottomed out, “panel and retail prices, which have been falling for over a year, could stimulate consumer sentiment, and in particular, the recovery of demand for ultra-large TVs, where prices have fallen significantly, could accelerate,” adding that “this would lead to a quick recovery in area demand.”

To secure a leading position in the ultra-large TV market, major panel manufacturers are mass-producing a variety of TV sizes, 70 inches and larger, and optimizing process efficiency to maximize manufacturing cost savings. OLED TVs are expected to increase their market share through improved picture quality and lower prices.

Additionally, the market for TVs larger than 70 inches is expected to grow by more than 15%, from 18 million units in 2022 to 21 million units in 2023.

By area, the market share of TVs 70 inches or larger is expected to exceed 20% of the overall TV display market for the first time in 2023. TV displays account for approximately 80% of total flat-panel display area shipments, and therefore, the recovery in TV display demand will impact the overall flat-panel display area demand forecast.

On the other hand, despite panel manufacturers' unprecedented efforts to reduce factory operating rates, inventory levels at set manufacturers have not yet normalized. This is expected to weigh on the panel demand market in the first half of 2023.