Universal Display Corporation Announces Fourth Quarter and Full Year 2024 Financial Results

Rhea-AI Summary

Universal Display (OLED) reported record financial results for Q4 and full year 2024. Total revenue for Q4 2024 reached $162.3 million, up from $158.3 million in Q4 2023. Material sales increased to $93.3 million from $82.2 million, while royalty and license fees decreased to $64.4 million from $72.9 million.

For the full year 2024, total revenue was $647.7 million, compared to $576.4 million in 2023. Net income for 2024 was $222.1 million ($4.65 per diluted share), up from $203.0 million ($4.24 per diluted share) in 2023. The company maintained a 77% gross margin in both periods.

Looking ahead, Universal Display provided 2025 revenue guidance of $640-700 million. The company also announced a Q1 2025 cash dividend of $0.45 per share, payable on March 31, 2025.

Positive

• Record annual revenue of $647.7 million in 2024, up 12.4% from 2023
• Material sales increased to $365.4 million in 2024 from $322.0 million in 2023
• Net income grew to $222.1 million in 2024 from $203.0 million in 2023
• Maintained strong gross margin of 77% in both 2024 and 2023
• Royalty and license fees increased to $266.8 million in 2024 from $238.4 million in 2023

Negative

• Q4 royalty and license fees declined to $64.4 million from $72.9 million year-over-year
• Restructuring costs of $8.9 million related to OVJP California location closure
• Foreign currency exchange losses of $7.2 million in 2024
• Operating income in Q4 2024 decreased to $52.5 million from $64.7 million in Q4 2023

Insights

Financial Analyst

Universal Display's Q4 and full-year 2024 results reveal a company successfully navigating market transitions while maintaining exceptional profitability metrics. The standout 77% gross margin demonstrates remarkable pricing power and operational efficiency, significantly above typical semiconductor industry averages of 50-60%.

The divergence between material sales ($93.3M, up 13.5%) and royalty revenue ($64.4M, down 11.7%) in Q4 signals a strategic shift in the OLED industry. The growth in material sales suggests increasing OLED adoption and production volumes, while the royalty decline reflects evolving customer relationships and potential pricing pressures in maturing market segments.

The $8.9M restructuring charge for the OVJP facility closure represents a strategic pivot away from certain R&D initiatives, likely to focus resources on more promising growth areas in IT and automotive applications. This aligns with industry trends as OLED technology expands beyond smartphones and TVs into new high-margin segments.

The 2025 revenue guidance of $640-700M implies relatively modest growth of 0-8% from 2024's $647.7M. This conservative outlook likely factors in ongoing customer mix changes and potential macroeconomic headwinds, while leaving room for upside if the new capex cycle in the OLED industry accelerates faster than anticipated.

The sustained quarterly dividend of $0.45 per share reflects management's confidence in maintaining strong cash flows, supported by the company's extensive patent portfolio of over 6,500 patents and its critical position in the OLED supply chain. The combination of high margins, growing material sales, and strategic market positioning suggests Universal Display remains well-positioned to capitalize on the expanding OLED market, particularly as new applications emerge in IT and automotive sectors.

EWING, N.J.--(BUSINESS WIRE)-- Universal Display Corporation (Nasdaq: OLED), enabling energy-efficient displays and lighting with its UniversalPHOLED^® technology and materials, today reported financial results for the fourth quarter and full year ended December 31, 2024.

“We are pleased to report that 2024 was a record-breaking year of solid financial performance,” said Brian Millard, Vice President and Chief Financial Officer of Universal Display Corporation. “Across the OLED industry, product roadmaps are expanding, and leading panel makers are investing in new fabs to meet the increasing demand, particularly in the emerging IT and automotive markets. We believe this new capex cycle will pave the way for meaningful new OLED capacity, new OLED products, and new OLED adoptees. As a pioneer and leader in the ecosystem, we are well positioned to continue supporting our customers and enabling the industry with our broadening portfolio of energy-efficient, high-performing phosphorescent materials and OLED technologies.”

Financial Highlights for the Fourth Quarter of 2024

• Total revenue in the fourth quarter of 2024 was $162.3 million as compared to $158.3 million in the fourth quarter of 2023.
• Revenue from material sales was $93.3 million in the fourth quarter of 2024 as compared to $82.2 million in the fourth quarter of 2023. The increase in material sales was primarily due to strengthened demand for our emitter materials, partially offset by changes in customer mix.
• Revenue from royalty and license fees was $64.4 million in the fourth quarter of 2024 as compared to $72.9 million in the fourth quarter of 2023. The decrease was primarily due to a reduction in cumulative catch-up adjustments related to royalty and license fees and changes in customer mix.
• Cost of material sales was $34.2 million in the fourth quarter of 2024 as compared to $33.4 million in the fourth quarter of 2023 due to higher unit material volume.
• Total gross margin was 77% in the fourth quarter of 2024 and 2023.
• Fourth quarter 2024 results include $8.9 million of restructuring costs, recorded in research and development expenses, related to the planned closure of the OVJP California location and related reorganization; and $6.7 million of foreign currency exchange losses related to a tax receivable denominated in Korean Won. These two items resulted in a combined $0.26 reduction in diluted earnings per share for the fourth quarter of 2024. Foreign exchange gains of $2.6 million were recognized in the fourth quarter of 2023 related to this tax receivable denominated in Korean Won, resulting in a $0.04 increase in diluted earnings per share.
• Operating income was $52.5 million in the fourth quarter of 2024 as compared to $64.7 million in the fourth quarter of 2023.
• The effective income tax rate was 16.8% and 18.0% in the fourth quarter of 2024 and 2023, respectively.
• Net income was $46.0 million or $0.96 per diluted share in the fourth quarter of 2024 as compared to $62.0 million or $1.29 per diluted share in the fourth quarter of 2023.

Revenue Comparison

($ in thousands)		Three Months Ended December 31,
		2024				2023
Material sales		$	93,265			$	82,240
Royalty and license fees			64,411				72,865
Contract research services			4,617				3,215
Total revenue		$	162,293			$	158,320

Cost of Materials Comparison

($ in thousands)		Three Months Ended December 31,
		2024				2023
Material sales		$	93,265			$	82,240
Cost of material sales			34,248				33,379
Gross margin on material sales			59,017				48,861
Gross margin as a % of material sales			63	%			59	%

Financial Highlights for the Full Year of 2024

• Total revenue in the full year 2024 was $647.7 million as compared to $576.4 million in the full year 2023.
• Revenue from material sales was $365.4 million in the full year 2024 as compared to $322.0 million in the full year 2023. The increase in material sales was primarily due to strengthened demand for our emitter materials, partially offset by changes in customer mix.
• Revenue from royalty and license fees was $266.8 million in 2024 as compared to $238.4 million in 2023. The increase in royalty and license fees was primarily the result of higher unit material volume and changes in customer mix.
• Cost of material sales was $137.0 million in 2024 as compared to $123.1 million in 2023 primarily due to an increase in materials sales volume and product mix, partially offset by a $5.4 million decrease in inventory reserve expense.
• Total gross margin was 77% in the full year 2024 and 2023.
• Results for 2024 include $8.9 million of restructuring costs, recorded in research and development expenses, related to the planned closure of the OVJP California location and related reorganization; and $7.2 million of foreign currency exchange losses related to a tax receivable denominated in Korean Won. These two items resulted in a combined $0.27 reduction in diluted earnings per share for the full year 2024. Foreign exchange losses of $732,000 were recognized in the full year 2023 related to this tax receivable denominated in Korean Won, resulting in a $0.01 decrease in diluted earnings per share.
• Operating income was $238.8 million in 2024 as compared to $217.2 million in 2023.
• The effective income tax rate was 18.4% and 17.2% in 2024 and 2023, respectively.
• Net income was $222.1 million or $4.65 per diluted share in 2024 compared to $203.0 million or $4.24 per diluted share in 2023.

Revenue Comparison

($ in thousands)		Year Ended December 31,
		2024				2023
Material sales		$	365,419			$	322,029
Royalty and license fees			266,820				238,389
Contract research services			15,445				16,011
Total revenue		$	647,684			$	576,429

Cost of Materials Comparison

($ in thousands)		Year Ended December 31,
		2024				2023
Material sales		$	365,419			$	322,029
Cost of material sales			137,006				123,076
Gross margin on material sales			228,413				198,953
Gross margin as a % of material sales			63	%			62	%

2025 Guidance

The Company believes that its 2025 revenue will be in the range of $640 million to $700 million. The OLED industry remains at a stage where many variables can have a material impact on results, and the Company thus caveats its financial guidance accordingly.

Dividend

The Company also announced a first quarter 2025 cash dividend of $0.45 per share on the Company’s common stock. The cash dividend is payable on March 31, 2025 to all shareholders of record as of the close of business on March 17, 2025.

Conference Call Information

In conjunction with this release, Universal Display will host a conference call on Thursday, February 20, 2025 at 5:00 p.m. Eastern Time. The live webcast of the conference call can be accessed under the events page of the Company's Investor Relations website at ir.oled.com. Those wishing to participate in the live call should dial 1-877-524-8416 (toll-free) or 1-412-902-1028. Please dial in 5-10 minutes prior to the scheduled conference call time. An online archive of the webcast will be available within two hours of the conclusion of the call.

About Universal Display Corporation

Universal Display Corporation (Nasdaq: OLED) is a leader in the research, development and commercialization of organic light emitting diode (OLED) technologies and materials for use in display and solid-state lighting applications. Founded in 1994 and with subsidiaries and offices around the world, the Company currently owns, exclusively licenses or has the sole right to sublicense more than 6,500 patents issued and pending worldwide. Universal Display licenses its proprietary technologies, including its breakthrough high-efficiency UniversalPHOLED® phosphorescent OLED technology that can enable the development of energy-efficient and eco-friendly displays and solid-state lighting. The Company also develops and offers high-quality, state-of-the-art UniversalPHOLED materials that are recognized as key ingredients in the fabrication of OLEDs with peak performance. In addition, Universal Display delivers innovative and customized solutions to its clients and partners through technology transfer, collaborative technology development and on-site training. To learn more about Universal Display Corporation, please visit https://oled.com/.

Universal Display Corporation and the Universal Display Corporation logo are trademarks or registered trademarks of Universal Display Corporation. All other Company, brand or product names may be trademarks or registered trademarks.

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 Securities and Exchange Commission, including, in particular, the section entitled “Risk Factors” in Universal Display Corporation’s Annual Report on Form 10-K for the year ended December 31, 2024. Universal Display Corporation disclaims any obligation to update any forward-looking statement contained in this document.

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UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED BALANCE SHEETS
(in thousands, except share and per share data)
		December 31, 2024				December 31, 2023
ASSETS
CURRENT ASSETS:
Cash and cash equivalents		$	98,980			$	91,985
Short-term investments			393,690				422,137
Accounts receivable			113,648				139,850
Inventory			182,938				175,795
Other current assets			110,575				87,365
Total current assets			899,831				917,132
PROPERTY AND EQUIPMENT, net of accumulated depreciation of $169,877 and $143,908			195,239				175,150
ACQUIRED TECHNOLOGY, net of accumulated amortization of $203,621 and $186,850			73,554				90,325
OTHER INTANGIBLE ASSETS, net of accumulated amortization of $11,842 and $10,414			5,446				6,874
GOODWILL			15,535				15,535
INVESTMENTS			457,593				299,548
DEFERRED INCOME TAXES			78,320				59,108
OTHER ASSETS			106,815				105,289
TOTAL ASSETS		$	1,832,333			$	1,668,961
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable		$	36,590			$	10,933
Accrued expenses			46,026				52,080
Deferred revenue			33,074				47,713
Other current liabilities			9,720				8,096
Total current liabilities			125,410				118,822
DEFERRED REVENUE			537				12,006
RETIREMENT PLAN BENEFIT LIABILITY			54,450				52,249
OTHER LIABILITIES			35,411				38,658
Total liabilities			215,808				221,735
SHAREHOLDERS’ EQUITY:
Preferred Stock, par value $0.01 per share, 5,000,000 shares authorized, 200,000 shares of Series A Nonconvertible Preferred Stock issued and outstanding (liquidation value of $7.50 per share or $1,500)			2				2
Common Stock, par value $0.01 per share, 200,000,000 shares authorized, 48,834,541 and 48,731,026 shares issued, and 47,468,893 and 47,365,378 shares outstanding at December 31, 2024 and December 31, 2023, respectively			488				487
Additional paid-in capital			723,719				699,554
Retained earnings			934,655				789,553
Accumulated other comprehensive loss			(1,055	)			(1,086	)
Treasury stock, at cost (1,365,648 shares at December 31, 2024 and December 31, 2023)			(41,284	)			(41,284	)
Total shareholders’ equity			1,616,525				1,447,226
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY		$	1,832,333			$	1,668,961

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF INCOME
(in thousands, except share and per share data)
		Three Months Ended December 31,								Twelve Months Ended December 31,
			2024				2023				2024				2023
REVENUE:		(Unaudited)
Material sales		$	93,265			$	82,240			$	365,419			$	322,029
Royalty and license fees			64,411				72,865				266,820				238,389
Contract research services			4,617				3,215				15,445				16,011
Total revenue			162,293				158,320				647,684				576,429
COST OF SALES			37,352				36,019				148,461				135,376
Gross margin			124,941				122,301				499,223				441,053
OPERATING EXPENSES:
Research and development			46,287				33,641				157,187				130,481
Selling, general and administrative			19,529				16,830				74,286				67,387
Amortization of acquired technology and other intangible assets			4,552				4,551				18,200				15,993
Patent costs			1,964				2,300				8,699				9,356
Royalty and license expense			120				233				2,048				647
Total operating expenses			72,452				57,555				260,420				223,864
OPERATING INCOME			52,489				64,746				238,803				217,189
Interest income, net			10,609				7,865				40,682				28,166
Other (loss) income, net			(7,773	)			2,996				(7,357	)			(184	)
Interest and other (loss) income, net			2,836				10,861				33,325				27,982
INCOME BEFORE INCOME TAXES			55,325				75,607				272,128				245,171
INCOME TAX EXPENSE			(9,306	)			(13,629	)			(50,049	)			(42,160	)
NET INCOME		$	46,019			$	61,978			$	222,079			$	203,011
NET INCOME PER COMMON SHARE:
BASIC		$	0.97			$	1.30			$	4.66			$	4.25
DILUTED		$	0.96			$	1.29			$	4.65			$	4.24
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET INCOME PER COMMON SHARE:
BASIC			47,545,820				47,571,382				47,548,931				47,559,669
DILUTED			47,671,374				47,657,854				47,652,662				47,622,763
CASH DIVIDEND DECLARED PER COMMON SHARE		$	0.40			$	0.35			$	1.60			$	1.40

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES
CONSOLIDATED STATEMENTS OF CASH FLOWS
(in thousands)
		Year Ended December 31,
			2024				2023
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income		$	222,079				203,011
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation			25,940				27,409
Impairment of property and equipment and right-of-use asset due to OVJP restructuring			7,498				—
Amortization of intangibles			18,200				15,993
Amortization of premium and discount on investments, net			(7,399	)			(11,603	)
Stock-based compensation			30,032				24,109
Deferred income tax benefit			(19,117	)			(3,766	)
Retirement plan expense, net of benefit payments			1,808				3,129
Decrease (increase) in assets:
Accounts receivable			26,202				(47,186	)
Inventory			(7,143	)			7,425
Other current assets			(23,210	)			(41,574	)
Other assets			(2,968	)			4,450
Increase (decrease) in liabilities:
Accounts payable and accrued expenses			10,357				4,047
Other current liabilities			1,269				(21,481	)
Deferred revenue			(26,108	)			(4,159	)
Other liabilities			(3,700	)			(5,027	)
Net cash provided by operating activities			253,740				154,777
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment			(42,637	)			(59,792	)
Purchase of intangibles			—				(66,563	)
Purchases of investments			(594,848	)			(531,103	)
Proceeds from sale and maturity of investments			473,075				574,165
Net cash used in investing activities			(164,410	)			(83,293	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock			2,220				2,012
Payment of withholding taxes related to stock-based compensation to employees			(8,386	)			(8,206	)
Cash dividends paid			(76,169	)			(66,735	)
Net cash used in financing activities			(82,335	)			(72,929	)
INCREASE (DECREASE) IN CASH AND CASH EQUIVALENTS			6,995				(1,445	)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR			91,985				93,430
CASH AND CASH EQUIVALENTS, END OF YEAR		$	98,980			$	91,985
SUPPLEMENTAL DISCLOSURES:
Unrealized gain on available-for-sale securities		$	411			$	8,938
Common stock issued to Board of Directors and Scientific Advisory Board that was earned and accrued for in a previous period			300				300
Net change in accounts payable and accrued expenses related to purchases of property and equipment			(9,448	)			678
Cash paid for income taxes, net of refunds			71,973				96,176

 

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Universal Display Contact:

Darice Liu

investor@oled.com

media@oled.com

+1 609-964-5123

Source: Universal Display Corporation

FAQ

What was Universal Display's (OLED) revenue guidance for 2025?

Universal Display provided revenue guidance of $640-700 million for 2025.

How much did Universal Display (OLED) earn per share in 2024?

Universal Display reported earnings of $4.65 per diluted share in 2024, compared to $4.24 per diluted share in 2023.

What is Universal Display's (OLED) dividend payment for Q1 2025?

The company announced a Q1 2025 cash dividend of $0.45 per share, payable on March 31, 2025.

How did Universal Display's (OLED) material sales perform in 2024?

Material sales increased to $365.4 million in 2024 from $322.0 million in 2023, primarily due to strengthened demand for emitter materials.

What was Universal Display's (OLED) gross margin in 2024?

Universal Display maintained a gross margin of 77% in both 2024 and 2023.