Universal Display (OLED) investor relations material

Executive summary

• Q2 2026 revenue was $152.2 million, down 11% year-over-year, with net income of $49.4 million ($1.06 per diluted share), reflecting lower material sales and changes in customer mix.

• Royalty and license fees rose to $81.2 million, aided by favorable catch-up adjustments, while contract research services (Adesis) contributed $4.8 million, down from $7.5 million.

• Gross margin was 76% (down from 77% prior year); operating income was $53.6 million (35% margin), and diluted EPS was $1.06, down from $1.41.

• Management highlights ongoing OLED ecosystem investments, expanding adoption in IT, automotive, and new form factors, and maintains leadership through R&D and a robust patent portfolio.

• Near-term demand has softened, especially in smartphones, but long-term OLED area growth is expected to resume in 2027.

Financial highlights

• Six-month revenue was $294.4 million, down 13% year-over-year; net income was $85.3 million, a 35% decrease.

• Material sales in Q2 2026 were $66.2 million (down 25%), with green emitter sales at $51 million and red emitter sales at $15 million.

• Royalty and license revenue for six months was $135.4 million, down 9% year-over-year.

• Gross margin on material sales dropped to 50% in Q2 2026 from 61% in Q2 2025.

• Cash and equivalents at June 30, 2026 were $120.6 million; total liquidity (including investments) was $854.5 million.

Outlook and guidance

• 2026 revenue is now expected at the lower end of the $630 million–$670 million guidance range, with H2 revenue projected to exceed H1.

• Second half of 2026 expected to be stronger, driven by new product launches and increased fab activity.

• Full-year operating expenses projected to rise by a low single-digit percentage.

• Materials gross margins expected to normalize to around 60% in H2 after Q2 anomalies.

• Management expects sufficient liquidity for at least the next twelve months.