LG Display Co., Ltd. Q1 FY2026 earnings call

• Despite Q1 seasonality, remained profitable for 3 months in a row due to years-long efforts to transition to OLED-based business structure, innovation of cost, and improvement of operational efficiency. • Increased OLED share in total revenue to 60%, a 5 percentage point increase Y-o-Y. • Outlined plans by business segment: Small-sized mobile business to flexibly respond to customer needs; midsized business to focus on high value-added products; large panel business to strengthen premium product lineup; monitor business to grow OLED and expand gaming product lineup; auto business to solidify market position. • Maintained CapEx principle of allocating towards essential current and future-proof technology investment, with 2026 CapEx expected at around KRW 2 trillion.

Revenue in Q1 was KRW 5.534 trillion, down 9% year-over-year and 23% quarter-on-quarter. Operating profit was KRW 146.7 billion, rising Y-o-Y. Operating profit margin was 3%, and EBITDA margin was 21%. Net income recorded a loss of KRW 575.7 billion. Area shipment in Q1 was 3.2 million square meters, down 21% Q-o-Q. ASP per square meter fell 4% Q-o-Q but was up 55% Y-o-Y. Revenue breakdown by product category: TV was 16%, IT 37%, Mobile and Others 37% (down 3 percentage points Q-o-Q), Auto 10% (up 3 percentage points Q-o-Q). OLED product group accounted for 60% of total revenue, up 5 percentage points Y-o-Y. Cash and cash equivalents in Q1 was KRW 1.525 trillion, largely unchanged Q-o-Q. Current ratio was 74%, debt-to-equity ratio at 251%, net debt-to-equity ratio at 157%.

• Total area expected to grow by low 10% level Q-o-Q, driven by shipment increase in large-sized panels. • Price per square meter expected to fall by low to mid-10% due to lower shipments from mobile products seasonality.

• External environment has higher uncertainties than ever, including rising semiconductor prices, declining global demand, rising energy costs, and supply chain disruptions, making it difficult to estimate full impact. • Memory shortage and geopolitical conflict may trigger production disruptions, shifts in demand, rising cost, and price pressure from customers.

Q: Can the company provide more details about the KRW 1.1 trillion OLED investment and its strategy regarding foldable smartphones?

A: CFO said company is focused on OLED business, disclosed new facility investment but specifics can't be discussed further. Paek Seung-yong said position on foldables unchanged, will prepare supply system for smartphones if clear opportunities identified.

Q: Impact on demand and company's response regarding memory shortage and geopolitical conflict?

A: Cho Seung Hyun said look at first half and second half separately. First half has pull in demand due to memory supply concerns and major sporting events. Second half more cautious. Will closely monitor demand and component supply, collaborate with customers, focus on cost innovation.

Q: Operational and growth strategy for large panel business?

A: Kyong Jeong Deuk said will establish stable revenue structure by enhancing high-end OLED TV lineup with global set makers and expanding mid- to low-end OLED TV lineup. OLED monitor segment's high-end gaming monitor market shifting to OLED, aim to maximize business performance.

Q: When will company turn around to profitability and plan for IT OLED investment?

A: Ahn Yu-Shin said ongoing uncertainties make IT sector recovery hard this year. Will focus on high-end differentiated products. Regarding IT OLED, will proceed cautiously until clear demand visibility, utilize existing infrastructure efficiently.

Q: Expected scale of voluntary retirement adjustment and future workforce adjustments?

A: Unknown executive said another round of workforce adjustment this year as part of transition to OLED-centric company. Specific scale and cost too early to tell, but offering strengthened package this time.