Lenovo


2022-02-24

Notebook Panel Shipments Hit Record High 282 million in 2021, Potential Risk of Correction in 1H22, Says TrendForce

In 2021, notebook panel shipments reached a record high of 282 million units, with an annual growth rate of 25.1%, according to TrendForce’s research. In the first half of the year, demand was driven by the pandemic and primarily focused on consumer notebooks and Chromebooks while, in the second half of the year, as Europe and the United States gradually lifted lockdowns and work returned to normal, demand largely shifted to commercial models, which continued to support the demand for notebook panels throughout the year.

It is worth noting that TrendForce believes shipment totals of notebook panels from 1Q22 to 2Q22 may be corrected. Notebook panel shipments in 1Q22 are estimated at approximately 67.9 million units, a QoQ decline of 9.7% while 2Q22 shipments are expected to drop to 61.4 million units, down 9.5% QoQ. In addition to the impact of the traditional off-season, there are two reasons for this correction. One is that inventory on the brand-side has increased. Due to the shortage of panels in the past two years, the brand-side continued to purchase panels in 2021 to avoid supply chain disruption. Normally, notebook brands hold 4 to 8 weeks of inventory but some brands have already stocked up to 8 weeks. Two, since a whole notebook requires numerous components, it cannot be assembled and shipped if even one is missing. Limitations impose by incomplete materials lists caused the growth rate of notebook computer shipments to fall behind that of panel shipments, shifting notebook computer panels into oversupply.

Despite this, TrendForce has specifically mentioned, since the profit margin of notebook panels still beats LCD monitor panels and TV panels, panel makers will still desire an increase in the supply of notebook panels. However, in the face of a possible correction in notebook panel shipments, panel makers may accumulate more inventory and deepen the downward pressure on notebook panel pricing.

Looking forward to 2022, panel shipment performance and price trends will be adversely affected by adjustments in notebook brand inventories in 1H22. In 2H22, notebook brands will continue to focus on sales plans for whole notebook computers. The sales performance of these brands during the peak season is still worth looking forward to and the restocking momentum of notebook panels is expected to recover. Current estimates put the shipment of notebook panels at 265 million in 2022, a decrease of 6.0% YoY.

2021-12-29

Non-Apple notebook manufacturers still unlikely adopt Mini LED displays while SDC aggressively ventures into notebook display market with OLED panels

Despite their similar physical dimensions, notebook panels and tablet panels entail drastically different market conditions. Being two of the strongest performers in the relatively oligopolistic tablet market, Apple and Samsung collectively possess a nearly 60% market share, thereby forcing other brands to adopt a relatively passive strategy that prioritizes conserving market share over adopting emerging technologies. In contrast, the notebook computer market has remained competitive throughout the years, with market leaders HP, Lenovo, and Dell holding the absolute advantage in the commercial notebook segment. Even so, Acer and Asus still enjoy some degree of dominance in the consumer segment, not to mention the fact that Apple has carved a niche market of its own thanks to the absolute differentiation of MacBooks from the rest of the field.

With greater diversity of brands comes greater competition in the market. As such, companies must now continue to refresh their product specs and product ranges in order to stay competitive. In this regard, Mini LED products would appear to be likelier to see adoption in the notebook computer market than in the tablet market. It should be pointed out that SDC (Samsung Display Co.) holds the sole patent for OLED tablet panels – the main competitor of display solutions featuring Mini LED backlights and LCD panels. Although SDC is still figuring out its medium- and long-term strategies in the tablet market, it has been relatively aggressive in capturing share in the notebook market. For instance, SDC’s OLED notebook panels have been gradually cannibalizing market shares from LCD notebook panels since 2021. To date, more than four million notebook computers featuring Samsung’s OLED panels have been shipped, accounting for a nearly 2% market share. In addition, almost all mainstream notebook brands have started carrying their respective lineup of OLED notebooks.

The meteoric rise of OLED models in the notebook market this year can primarily be attributed to SDC, which is the sole supplier of OLED notebook panels. Whereas SDC previously allocated most of its production capacity for OLED (Rigid OLED) panels to smartphone displays, the successive ramp-up of Gen 6 production lines for OLED (Flexible OLED) panels in China has resulted in a hypercompetitive market with plummeting quotes that both placed significant downward pressure on the existing price band of rigid OLED panels and negatively affected demand for rigid OLED panels. Given that the aforementioned factors are unlikely to reverse course, SDC has therefore decided to reallocate their production capacity for rigid OLED panels from smartphone displays to notebook displays instead, since the former has continued to decline as an added value while the latter appears to have much more potential for growth.

Incidentally, SDC has spent considerable time cultivating its presence in the notebook computer market. The company formerly positioned its OLED solutions exclusively in the flagship market segment, with UHD/4K being the only resolution available on its OLED notebook panels. The adoption of these products was lukewarm at best due to OLED panels’ prohibitive prices and the very limited target audience for UHD models. Moving to 2020, however, SDC adopted a more ambitious approach to the notebook market and subsequently released a host of OLED panels featuring Full HD resolution in accordance with the mainstream market’s demands. By doing so, SDC was able to not only substantially lower its OLED notebook panel quotes, but also align its products with the enormous total addressable market of mainstream notebook consumers, in turn skyrocketing notebook brands’ willingness to adopt OLED panels.

Not only have OLED displays enjoyed a longstanding presence in the high-end smartphone and TV segments, but most consumers also generally understand that OLED panels are superior to traditional LCD panels with respect to such specifications as color saturation, contrast levels, and even physical thickness. For notebook computer brands, adopting OLED panels in their displays allows said brands to cut down on costs that would otherwise have to be spent on either educating the average consumer on popular science topics related to display technology or marketing the brands’ display solutions, as OLED displays’ superior specs are already widely known. That is why almost all mainstream brands, ranging from Asus to HP and Dell, have released OLED-equipped notebook computers, some of which even boast consumer-oriented product positions and consumer-friendly retail prices.

On the other hand, although the integration of Mini LED backlights significantly bolsters LCD panels’ traditionally weak contrast levels, significant marketing costs are required to ensure consumers understand the benefits of this new backlighting technology. While OLED solutions are already widely recognized in the market, Mini LED products’ vast marketing costs represent a significant competitive weakness against OLED products. Furthermore, manufacturing costs of display solutions that feature Mini LED backlights and LCD panel modules are about 30-50% higher than those of equivalent solutions featuring OLED panel modules due to the former’s complex design, high number of components, and limited economy of scale. Hence, high manufacturing costs are yet another obstacle preventing brands from investing in Mini LED development.

(Image credit: PikiWizard)

2021-11-19

Notebook Shipment for 2021 Expected to Reach 244 Million Units in Light of Weakening Market for Consumer Models in 2H21

TrendForce expects global notebook shipment for 2021 to reach 244 million units, with 49% and 51% of the annual shipment taking place in 1H21 and 2H21, respectively. This distribution would seem to indicate that, although the growth momentum of consumer notebook models that began in 1H21 has gradually waned, strong performances from the commercial notebook segment are able to provide some upward momentum for the notebook market’s shipment performance in 2H21.

The first half of the year saw tight supply of materials, strong upside demand, and a market driven primarily by consumer models

Despite the shortage of materials from the supply chain, global notebook shipment for 1H21 still reached 119 million units. During this time, the COVID-19 pandemic caused considerable worldwide impact. Given the important role played by notebook computers in bringing business, education, and entertainment from the real world to the virtual world, shipments of commercial notebooks, Chromebooks, and gaming notebooks, which respectively fulfill the three aforementioned functions, remained strong.

Take Chromebooks as an example; shipment of these products reached 25.94 million units for 1H21, primarily thanks to a wave of procurement demand for educational notebooks, which are primarily produced and sold in response to tender offers, by the US, Japanese, and western European governments in an attempt to immediately kick off distance learning initiatives. The bullish Chromebook market also incidentally resulted in a 70% increase across the 1Q20-2Q21 period in the ASP of 11.6-inch notebook panels, which are used in mainstream Chromebook models.

Shifting demand and stabilizing supply of materials in 2H21 mean commercial notebooks have now become the primary driver of market growth

As the supply chain’s availability of materials gradually stabilizes in 2H21, global shipment of notebooks for the period will still likely reach 125 million units, a 5.7% increase compared with 1H21. Regarding quarterly shipments, market demand peaked in 3Q21, during which a total of 62.73 million notebooks were shipped. Following this peak, demand has remained mostly unchanged in 4Q21, reaching a forecasted 62.71 million units in shipment for the quarter. This slight decline can primarily be attributed to an estimated shipment of 11.62 million Chromebooks for 2H21, which is a 55.2% decrease from 1H21. The downturn of Chromebooks indicates that the educational notebook market, which is mostly driven by Chromebooks, no longer has sufficient momentum to keep up its high shipment in 2H21. Instead, demand has now shifted to commercial notebooks as the pandemic’s slowdown resulted in a corresponding return to physical offices and schools for work and study, respectively.

Fortunately for notebook manufacturers, commercial notebooks, which are primarily aimed at servicing enterprise customers, are able to shore up the weakening demand for other product categories in time in 2H21. On average, up to 34% of the product mixes offered by notebook brands such as Dell, HP, and Lenovo now consist of commercial models during this period. As such, TrendForce expects commercial notebook shipment for 2021 to reach 65.61 million units and account for 26.9% of total notebook shipment for the year.

2021-07-08

With a forecasted double-digit decline in Chromebook shipment next year, is 2021’s stay-at-home peak over for the notebook market?

Although the stay-at-home economy has persisted through 2021, governments in Europe and the US are starting to lift restrictions in light of increased vaccinations. As such, it remains to be seen whether notebook computers will continue to experience strong demand and whether global notebook shipment will change accordingly.

TrendForce indicates that the YoY changes in annual notebook shipment for 2015-2019 remained within 3%, and about 160-165 million units were shipped each year during this period. However, as WFH and distance education became the norm due to the COVID-19 pandemic’s emergence in 2020, demand for notebooks has risen accordingly; global notebook shipment for 2021 is expected to reach 237 million units, a 15% YoY increase.

Nonetheless, TrendForce also believes that the easing of restrictions in Europe and the US in 2H21 will somewhat weaken the pandemic-generated demand for notebooks. While global notebook shipment for 2022 is expected to reach 222 million units, Chromebooks in particular will likely experience a double-digit decline. Shipments of other product categories, namely, business notebooks or consumer notebooks, are expected to decline by nearly 5%.

Chromebooks have been occupying an increasing share of the overall notebook market, from 11% in 2019 to 15% in 2020 and 20% in 2021. Volume-wise, the upward trajectory of Chromebooks has been nothing short of impressive. Chromebook shipment for 2020 reached 31.17 million units, a staggering 87% YoY increase. This momentum is expected to continue into 2021, during which annual Chromebook shipment will likely reach 46.87 million units, thereby becoming an indispensable driver of the global notebook market’s growth.

The US market accounts for the bulk(about 70%)of global Chromebook demand this year. That is why the near saturation of the US education notebook market and the impending return to physical locations for work and study after restrictions have been eased will lead to a slowdown of global education notebook demand.

At the same time, there will likely be a corresponding decline in demand for notebooks used in WFH applications, including business and consumer notebooks. TrendForce, therefore, believes that demand in the notebook market will peak in 2021 and slightly taper off in 2022.

(Cover image source: Lenovo StoryHub

2021-06-11

Third-Generation Semiconductor GaN Technology Expected to Revolutionize the Fast Charging Industry

In response to the increasing demands of mobile applications, manufacturers are now placing a priority on extending the battery life of such devices like smartphones and notebook computers. However, due to the inherent limitations of physical space in these devices, the quest for ever-greater battery capacity has seemingly reached a bottleneck, forcing them to look elsewhere for solutions, hence the development of fast charging technology. As such, fast chargers equipped with GaN (Gallium nitride, which is a third-generation semiconductor) chips have are now expected to introduce the next chapter for the fast charging market.

According to TrendForce’s latest investigations, as smartphone brands including Xiaomi, OPPO, and Vivo have successively been releasing fast chargers since 2018, the market demand for GaN power devices has undergone a corresponding growth as well. Given the continued upward trajectory of the market, GaN power device revenue for 2021 is expected to reach US$61 million, a 90.6% YoY increase.


Due to their low portability and tendency to overheat, traditional fast chargers are increasingly unable to meet consumer demand

In the past, fast chargers were generally based on Si (Silicon) chips. However, as these chargers increase in wattage, their mass and physical dimension increased as well, meaning they suffered from low portability and a tendency to overheat when fast charging. On the other hand, as battery capacities expanded past the 4000mAh mark, traditional Si chargers began to see a drop in charging efficiency. In light of this, after certain breakthroughs in GaN manufacturing technologies were achieved, next-gen GaN chargers are likely to completely transform most consumers’ preexisting impressions of fast chargers.

Nonetheless, the manufacturing costs of GaN chargers are still 80%-120% higher compared with Si chargers at the moment. That is why very few devices bundle GaN chargers as a standard accessory included with the purchase and why GaN chargers are consequently sold separately instead. TrendForce expects the market for GaN chargers to experience rapid growth in 2021, with about 57 million units shipped for the year.

IC design company Navitas is the biggest winner in the GaN charger supply chain

The GaN charger supply chain encompasses virtually all major companies in various industries, and companies for which GaN businesses account for a larger share of their sales or technologies are more likely to benefit from the booming GaN charging market as well. As the largest supplier of GaN charger chips at the moment, Navitas has a clientele consisting of such major brands as Xiaomi, OPPO, Lenovo, Asus-Adol, and Dell. TrendForce’s investigations find that Navitas’ share in the GaN charger chip market surpassed 50% as of last year.

Navitas’ chips are currently fabricated with TSMC’s GaN on Si technology on 6-inch wafers, while TSMC is planning to increase its GaN production capacities by outsourcing its epitaxial processes to Ennostar subsidiary Unikorn. As Navitas expands its shipment volume going forward, TSMC and Ennostar are expected to benefit as well.

(Cover image source: Unsplash)

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