Weak demand for TVs and an oversupply of LCD panels are being blamed by LG Display for a net loss in the first quarter of this year.
The company, which is the world's second largest flat-panel display maker (after Korean rival Samsung), showed a loss of KRW115bn (£64m) in the first three months of 2011, compared to a profit of KRW649bn (£365m) in the same period last year.
The loss was less than had been feared by some analysts, with demand for panels used in portable devices to some extent offsetting the weakness in revenue from TV panels.
However, the company expects that – due to factors including the March 11 earthquake and tsunami in Japan – there could be a shortage of crucial LCD components, and this will serve to stabilise panel prices.
It's expecting to show a profit again in the current quarter, and for the reverse in fortunes to allow it to break even for the first half of the year.
LG also expects demand for LCD displays – from those used for TVs to the smaller panels found in everything from smartphones to iPads – to show growth approaching 20% in the current quarter, while higher-margin displays for 3D applications will also see surging sales, again helping the bottom line.
It will also be ramping up production at its factories, currently running at somewhere around 85% capacity.
A major driving force of this revival is likely to be the company's film-patterned retarder technology, used for 3D TVs viewable with simpler polarised glasses, rather than the more expensive active-shutter systems.
Announcing the results, LG Display's chief financial officer James Jeong also confirmed that the company is in talks with Sony to supply the Japanese company with its new technology for making 3D displays, and he said that he expects to see results from those discussions this year.
Sony has not commented on the matter.
