Universal Display (OLED) investor relations material

Executive summary

• Q1 2026 revenue was $142.2 million, down 14% year-over-year, driven by lower material volumes, royalty, license fees, and customer mix shifts.

• Net income for Q1 2026 was $35.9 million ($0.76 per diluted share), a 44% decrease from $64.4 million ($1.35 per share) in Q1 2025.

• Gross margin declined to 75% from 77% year-over-year due to lower royalty and license fees.

• Long-term OLED growth prospects remain strong, with expanding adoption in IT, automotive, TV, and foldables, and upcoming Gen 8.6 capacity additions in Korea and China.

• New long-term agreements were signed with Tianma and LG Display, and over 300 OLED-related patents were acquired from Merck KGaA for $50 million.

Financial highlights

• Material sales were $83.7 million, down from $86.2 million year-over-year; green emitter sales stable at $64 million, red emitter sales declined to $20 million.

• Royalty and license fees dropped to $54.2 million from $74 million year-over-year.

• Contract research services revenue (Adesis) was $4.3 million, down from $6.6 million.

• Operating income was $42.8 million, down from $69.7 million in Q1 2025.

• Effective tax rate increased to 20.7% from 19.6% year-over-year.

Outlook and guidance

• Full-year 2026 revenue guidance revised to $630–$670 million from $650–$700 million, reflecting industry uncertainties.

• Q2 revenue expected to be sequentially higher, with stronger performance anticipated in the second half of 2026.

• Management expects customer mix to improve royalty and license fees in subsequent quarters.

• Operating expenses are expected to grow in the mid-single digits for the year, with continued investment in R&D.

• Sufficient liquidity is anticipated to meet obligations for at least the next twelve months.