Universal Display Corporation Announces Second Quarter 2024 Financial Results
“We reported solid second quarter results as the OLED IT adoption cycle begins to gain momentum,” said
Financial Highlights for the Second Quarter of 2024
-
Total revenue in the second quarter of 2024 was
$158.5 million as compared to$146.6 million in the second quarter of 2023. -
Revenue from material sales was
$95.4 million in the second quarter of 2024 as compared to$77.1 million in the second quarter of 2023. The increase in material sales was primarily due to strengthened demand for our emitter materials. -
Revenue from royalty and license fees was
$59.6 million in the second quarter of 2024 as compared to$64.4 million in the second quarter of 2023. The decrease in royalty and license fees was primarily the result of changes in customer mix between periods, partially offset by increased sales volume. -
Cost of material sales was
$35.5 million in the second quarter of 2024 as compared to$28.6 million in the second quarter of 2023. The increase in cost of material sales was primarily due to an increase in the level of materials sales. - Total gross margin was 76% in the second quarter of 2024 as compared to 78% in the second quarter of 2023. The decrease was primarily due to changes in customer and product mix.
-
Operating income was
$56.4 million in the second quarter of 2024 as compared to$58.6 million in the second quarter of 2023. - The effective income tax rate was 19.3% and 22.4% in the second quarter of 2024 and 2023, respectively.
-
Net income was
$52.3 million or$1.10 per diluted share in the second quarter of 2024 as compared to$49.7 million or$1.04 per diluted share in the second quarter of 2023.
Revenue Comparison
($ in thousands) |
|
Three Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Material sales |
|
$ |
95,442 |
|
|
$ |
77,107 |
|
Royalty and license fees |
|
|
59,551 |
|
|
|
64,399 |
|
Contract research services |
|
|
3,512 |
|
|
|
5,059 |
|
Total revenue |
|
$ |
158,505 |
|
|
$ |
146,565 |
|
Cost of Materials Comparison
($ in thousands) |
|
Three Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Material sales |
|
$ |
95,442 |
|
|
$ |
77,107 |
|
Cost of material sales |
|
|
35,491 |
|
|
|
28,570 |
|
Gross margin on material sales |
|
|
59,951 |
|
|
|
48,537 |
|
Gross margin as a % of material sales |
|
|
63 |
% |
|
|
63 |
% |
Financial Highlights for the First Half of 2024
-
Total revenue in the first half of 2024 was
$323.8 million as compared to$277.0 million in the first half of 2023. -
Revenue from material sales was
$188.7 million in the first half of 2024 as compared to$147.3 million in the first half of 2023. The increase in material sales was primarily due to strengthened demand for our emitter materials. -
Revenue from royalty and license fees was
$127.8 million in the first half of 2024 as compared to$119.6 million in the first half of 2023. The increase in royalty and license fees was primarily the result of higher unit material volume, partially offset by a reduced cumulative catch-up adjustment and changes in customer mix between periods. -
Cost of material sales was
$69.6 million in the first half of 2024 as compared to$58.1 million in the first half of 2023 primarily due to an increase in the level of materials sales, partially offset by a$3.8 million decrease in inventory reserve expense. - Total gross margin was 77% in the first half of 2024 as compared to 76% in the first half of 2023.
-
Operating income was
$119.3 million in the first half of 2024 as compared to$104.0 million in the first half of 2023. - The effective income tax rate was 19.3% and 22.6% in the first half of 2024 and 2023, respectively.
-
Net income was
$109.2 million or$2.29 per diluted share in the first half of 2024 compared to$89.5 million or$1.87 per diluted share in the first half of 2023.
Revenue Comparison
($ in thousands) |
|
Six Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Material sales |
|
$ |
188,726 |
|
|
$ |
147,297 |
|
Royalty and license fees |
|
|
127,819 |
|
|
|
119,609 |
|
Contract research services |
|
|
7,219 |
|
|
|
10,126 |
|
Total revenue |
|
$ |
323,764 |
|
|
$ |
277,032 |
|
Cost of Materials Comparison
($ in thousands) |
|
Six Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
Material sales |
|
$ |
188,726 |
|
|
$ |
147,297 |
|
Cost of material sales |
|
|
69,587 |
|
|
|
58,058 |
|
Gross margin on material sales |
|
|
119,139 |
|
|
|
89,239 |
|
Gross margin as a % of material sales |
|
|
63 |
% |
|
|
61 |
% |
2024 Revised Guidance
The Company has increased the lower end of its previous revenue guidance and believes that 2024 revenue will be in the range of
Dividend
The Company also announced a third quarter cash dividend of
Conference Call Information
In conjunction with this release,
About
All statements in this document that are not historical, such as those relating to the projected adoption, development and advancement of the Company’s technologies, and the Company’s expected results, as well as the growth of the OLED market and the Company’s opportunities in that market, are forward-looking financial statements within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking statements in this document, as they reflect Universal Display Corporation’s current views with respect to future events and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated. These risks and uncertainties are discussed in greater detail in Universal Display Corporation’s periodic reports on Form 10-K and Form 10-Q filed with the
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(OLED-C)
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) (in thousands, except share and per share data) |
||||||||
|
|
|
|
|
|
|
||
ASSETS |
|
|
|
|
|
|
||
CURRENT ASSETS: |
|
|
|
|
|
|
||
Cash and cash equivalents |
|
$ |
92,856 |
|
|
$ |
91,985 |
|
Short-term investments |
|
|
437,667 |
|
|
|
422,137 |
|
Accounts receivable |
|
|
124,386 |
|
|
|
139,850 |
|
Inventory |
|
|
171,843 |
|
|
|
175,795 |
|
Other current assets |
|
|
132,729 |
|
|
|
87,365 |
|
Total current assets |
|
|
959,481 |
|
|
|
917,132 |
|
PROPERTY AND EQUIPMENT, net of accumulated depreciation of |
|
|
185,474 |
|
|
|
175,150 |
|
ACQUIRED TECHNOLOGY, net of accumulated amortization of |
|
|
81,940 |
|
|
|
90,325 |
|
OTHER INTANGIBLE ASSETS, net of accumulated amortization of |
|
|
6,163 |
|
|
|
6,874 |
|
|
|
|
15,535 |
|
|
|
15,535 |
|
INVESTMENTS |
|
|
362,459 |
|
|
|
299,548 |
|
DEFERRED INCOME TAXES |
|
|
66,664 |
|
|
|
59,108 |
|
OTHER ASSETS |
|
|
98,845 |
|
|
|
105,289 |
|
TOTAL ASSETS |
|
$ |
1,776,561 |
|
|
$ |
1,668,961 |
|
LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
|
|
|
|
|
||
CURRENT LIABILITIES: |
|
|
|
|
|
|
||
Accounts payable |
|
$ |
23,636 |
|
|
$ |
10,933 |
|
Accrued expenses |
|
|
58,624 |
|
|
|
52,080 |
|
Deferred revenue |
|
|
63,784 |
|
|
|
47,713 |
|
Other current liabilities |
|
|
5,955 |
|
|
|
8,096 |
|
Total current liabilities |
|
|
151,999 |
|
|
|
118,822 |
|
DEFERRED REVENUE |
|
|
6,732 |
|
|
|
12,006 |
|
RETIREMENT PLAN BENEFIT LIABILITY |
|
|
53,870 |
|
|
|
52,249 |
|
OTHER LIABILITIES |
|
|
37,122 |
|
|
|
38,658 |
|
Total liabilities |
|
|
249,723 |
|
|
|
221,735 |
|
SHAREHOLDERS’ EQUITY: |
|
|
|
|
|
|
||
Preferred Stock, par value |
|
|
2 |
|
|
|
2 |
|
Common Stock, par value |
|
|
488 |
|
|
|
487 |
|
Additional paid-in capital |
|
|
712,234 |
|
|
|
699,554 |
|
Retained earnings |
|
|
860,058 |
|
|
|
789,553 |
|
Accumulated other comprehensive loss |
|
|
(4,660 |
) |
|
|
(1,086 |
) |
|
|
|
(41,284 |
) |
|
|
(41,284 |
) |
Total shareholders’ equity |
|
|
1,526,838 |
|
|
|
1,447,226 |
|
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY |
|
$ |
1,776,561 |
|
|
$ |
1,668,961 |
|
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF INCOME (UNAUDITED) (in thousands, except share and per share data) |
||||||||||||||||
|
|
Three Months Ended |
|
|
Six Months Ended |
|
||||||||||
|
|
2024 |
|
|
2023 |
|
|
2024 |
|
|
2023 |
|
||||
REVENUE: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Material sales |
|
$ |
95,442 |
|
|
$ |
77,107 |
|
|
$ |
188,726 |
|
|
$ |
147,297 |
|
Royalty and license fees |
|
|
59,551 |
|
|
|
64,399 |
|
|
|
127,819 |
|
|
|
119,609 |
|
Contract research services |
|
|
3,512 |
|
|
|
5,059 |
|
|
|
7,219 |
|
|
|
10,126 |
|
Total revenue |
|
|
158,505 |
|
|
|
146,565 |
|
|
|
323,764 |
|
|
|
277,032 |
|
COST OF SALES |
|
|
38,328 |
|
|
|
32,139 |
|
|
|
75,297 |
|
|
|
65,109 |
|
Gross margin |
|
|
120,177 |
|
|
|
114,426 |
|
|
|
248,467 |
|
|
|
211,923 |
|
OPERATING EXPENSES: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
Research and development |
|
|
36,826 |
|
|
|
32,318 |
|
|
|
74,811 |
|
|
|
63,741 |
|
Selling, general and administrative |
|
|
19,841 |
|
|
|
17,077 |
|
|
|
39,093 |
|
|
|
32,473 |
|
Amortization of acquired technology and other intangible assets |
|
|
4,549 |
|
|
|
3,994 |
|
|
|
9,097 |
|
|
|
6,885 |
|
Patent costs |
|
|
2,401 |
|
|
|
2,229 |
|
|
|
4,383 |
|
|
|
4,484 |
|
Royalty and license expense |
|
|
123 |
|
|
|
169 |
|
|
|
1,774 |
|
|
|
333 |
|
Total operating expenses |
|
|
63,740 |
|
|
|
55,787 |
|
|
|
129,158 |
|
|
|
107,916 |
|
OPERATING INCOME |
|
|
56,437 |
|
|
|
58,639 |
|
|
|
119,309 |
|
|
|
104,007 |
|
Interest income, net |
|
|
9,913 |
|
|
|
6,198 |
|
|
|
19,481 |
|
|
|
13,165 |
|
Other loss, net |
|
|
(1,460 |
) |
|
|
(784 |
) |
|
|
(3,403 |
) |
|
|
(1,487 |
) |
Interest and other loss, net |
|
|
8,453 |
|
|
|
5,414 |
|
|
|
16,078 |
|
|
|
11,678 |
|
INCOME BEFORE INCOME TAXES |
|
|
64,890 |
|
|
|
64,053 |
|
|
|
135,387 |
|
|
|
115,685 |
|
INCOME TAX EXPENSE |
|
|
(12,553 |
) |
|
|
(14,375 |
) |
|
|
(26,197 |
) |
|
|
(26,168 |
) |
NET INCOME |
|
$ |
52,337 |
|
|
$ |
49,678 |
|
|
$ |
109,190 |
|
|
$ |
89,517 |
|
NET INCOME PER COMMON SHARE: |
|
|
|
|
|
|
|
|
|
|
|
|
||||
BASIC |
|
$ |
1.10 |
|
|
$ |
1.04 |
|
|
$ |
2.29 |
|
|
$ |
1.87 |
|
DILUTED |
|
$ |
1.10 |
|
|
$ |
1.04 |
|
|
$ |
2.29 |
|
|
$ |
1.87 |
|
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
BASIC |
|
|
47,549,843 |
|
|
|
47,572,971 |
|
|
|
47,553,969 |
|
|
|
47,548,404 |
|
DILUTED |
|
|
47,628,113 |
|
|
|
47,618,115 |
|
|
|
47,628,470 |
|
|
|
47,593,657 |
|
CASH DIVIDENDS DECLARED PER COMMON SHARE |
|
$ |
0.40 |
|
|
$ |
0.35 |
|
|
$ |
0.80 |
|
|
$ |
0.70 |
|
UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) (in thousands) |
||||||||
|
|
Six Months Ended |
|
|||||
|
|
2024 |
|
|
2023 |
|
||
CASH FLOWS FROM OPERATING ACTIVITIES: |
|
|
|
|
|
|
||
Net income |
|
$ |
109,190 |
|
|
$ |
89,517 |
|
Adjustments to reconcile net income to net cash provided by operating activities: |
|
|
|
|
|
|
||
Depreciation |
|
|
13,092 |
|
|
|
13,207 |
|
Amortization of intangibles |
|
|
9,097 |
|
|
|
6,885 |
|
Amortization of premium and discount on investments, net |
|
|
(4,276 |
) |
|
|
(6,845 |
) |
Stock-based compensation |
|
|
18,523 |
|
|
|
11,320 |
|
Deferred income tax benefit |
|
|
(7,402 |
) |
|
|
(12,782 |
) |
Retirement plan expense, net of benefit payments |
|
|
962 |
|
|
|
1,397 |
|
Decrease (increase) in assets: |
|
|
|
|
|
|
||
Accounts receivable |
|
|
15,464 |
|
|
|
(16,726 |
) |
Inventory |
|
|
3,952 |
|
|
|
7,365 |
|
Other current assets |
|
|
(45,364 |
) |
|
|
12,038 |
|
Other assets |
|
|
6,444 |
|
|
|
7,665 |
|
Increase (decrease) in liabilities: |
|
|
|
|
|
|
||
Accounts payable and accrued expenses |
|
|
12,367 |
|
|
|
(17,651 |
) |
Other current liabilities |
|
|
(2,141 |
) |
|
|
(20,811 |
) |
Deferred revenue |
|
|
10,797 |
|
|
|
(15,736 |
) |
Other liabilities |
|
|
(1,536 |
) |
|
|
(1,445 |
) |
Net cash provided by operating activities |
|
|
139,169 |
|
|
|
57,398 |
|
CASH FLOWS FROM INVESTING ACTIVITIES: |
|
|
|
|
|
|
||
Purchases of property and equipment |
|
|
(16,334 |
) |
|
|
(27,274 |
) |
Purchases of intangibles |
|
|
— |
|
|
|
(66,063 |
) |
Purchases of investments |
|
|
(174,757 |
) |
|
|
(115,048 |
) |
Proceeds from sale and maturity of investments |
|
|
97,620 |
|
|
|
190,907 |
|
Net cash used in investing activities |
|
|
(93,471 |
) |
|
|
(17,478 |
) |
CASH FLOWS FROM FINANCING ACTIVITIES: |
|
|
|
|
|
|
||
Proceeds from issuance of common stock |
|
|
1,187 |
|
|
|
971 |
|
Payment of withholding taxes related to stock-based compensation to employees |
|
|
(7,329 |
) |
|
|
(7,429 |
) |
Cash dividends paid |
|
|
(38,685 |
) |
|
|
(33,422 |
) |
Net cash used in financing activities |
|
|
(44,827 |
) |
|
|
(39,880 |
) |
INCREASE IN CASH AND CASH EQUIVALENTS |
|
|
871 |
|
|
|
40 |
|
CASH AND CASH EQUIVALENTS, BEGINNING OF PERIOD |
|
|
91,985 |
|
|
|
93,430 |
|
CASH AND CASH EQUIVALENTS, END OF PERIOD |
|
$ |
92,856 |
|
|
$ |
93,470 |
|
SUPPLEMENTAL DISCLOSURES: |
|
|
|
|
|
|
||
Unrealized (loss) gain on available-for-sale securities |
|
$ |
(2,976 |
) |
|
$ |
1,848 |
|
Common stock issued to Board of |
|
|
300 |
|
|
|
300 |
|
Net change in accounts payable and accrued expenses related to purchases of property
|
|
|
(7,082 |
) |
|
|
(54 |
) |
Cash paid for income taxes, net of refunds |
|
|
47,263 |
|
|
|
59,849 |
|
View source version on businesswire.com: https://www.businesswire.com/news/home/20240801261409/en/
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