Display driver manufacturer Novatek expects a strong Q1 off-season

Novatek's operating performance in Q1 of 2025 is expected to be better than the traditional off-season, mainly due to the increase in demand for AI mobile phones, AI PCs and laptop replacements, as well as the increase in OLED penetration. Although there are still uncertainties in the consumer electronics market, Novatek is expected to maintain solid performance in the off-season through its product line expansion, market share increase and urgent orders.

The supply chain situation in the display driver IC market has improved. Driven by low inventory levels, stabilizing prices, market share shifts and specification upgrades, Novatek, as the leader in the driver IC industry, is expected to benefit from this trend. In addition, domestic subsidies for TVs and personal computers drove up panel prices in January, which will also help further support market demand.

Novatek continues to deploy diversified products. The OLED flat panel market penetration rate is expected to increase, and TV SoC has also introduced new products and new customers. AI technology drives the demand for upgrades and replacements of PCs and laptops. In particular, the proportion of high-end laptops will increase, bringing growth momentum to related businesses. However, the recovery of the automotive market has been slower than expected, while the ASIC business has performed solidly.

The penetration rate of AMOLED in the smartphone market is expected to continue to grow, reaching 63% by 2026. Among them, the technical threshold of LTPO and foldable panel driver IC has been raised, which has led to the upgrade of product specifications and further consolidated Novatek's advantages in the market. With its technical capabilities and market competitiveness, the legal person is also optimistic that Novatek is expected to expand its market share among domestic, American and Korean smartphone brands.

Looking forward to 2025, the industry is expected to return to normal seasonal fluctuations. Although the overall economic uncertainty is still high and the market is changing rapidly, with the advantages of product lines and the recovery of market demand, Novatek's growth momentum still has room to play.

Novatek's revenue in 2024 will be NT$102.787 billion, an annual decrease of 6.9%; in the first three quarters of 2024, Novatek's after-tax surplus will be NT$15.54 billion, an annual decrease of 13.6%.