OLED

Universal Display Corporation OLED delivered second-quarter earnings above the Zacks Consensus Estimate, but revenues fell short as material sales weakened. Earnings of $1.06 per share topped the $1.04 consensus estimate by 1.9%, while revenues of $152.2 million missed the $158 million estimate by 3.9%.The mixed result reflects a business with resilient royalty revenues but weaker material volumes. Management expects second-half revenue to exceed first-half levels, yet its 2026 outlook remains toward the lower end of the $630 million to $670 million range, leaving material demand and margins as key recovery indicators. The second-quarter earnings beat was supported by the revenue mix and a favorable cumulative catch-up adjustment in royalty and license fees. Royalty and license revenue increased 7.3% year over year to $81.2 million, while material sales declined sharply.The result shows why quarterly earnings can remain relatively resilient even when material volumes are under pressure. Still, the revenue shortfall limits visibility because material sales are closely tied to customer production and OLED panel demand. Material sales declined 25.3% year over year to $66.2 million, primarily because of lower unit material volume, changes in customer mix and a $6.9 million unfavorable period-over-period change in the cumulative catch-up adjustment. Royalty and license fees, in contrast, rose to $81.2 million from $75.7 million.The shift helped cushion revenues but did not prevent profitability from weakening. Operating income fell to $53.6 million from $68.5 million, while net income declined to $49.4 million from $67.3 million. The contrasting trends also make material volumes an important measure of the company's underlying demand. Universal Display Corporation price-consensus-eps-surprise-chart | Universal Display Corporation Quote Universal Display now expects 2026 revenues toward the lower end of its $630 million to $670 million range. Management cited cautious customer forecasts and lower expected material volume as factors behind the outlook.At the same time, management expects second-half revenues to exceed first-half revenues, supported by product launches and customer forecasts. That improvement is important to the recovery thesis because it would show that the first-half weakness is not becoming a full-year deterioration in OLED demand. Image Source: Zacks Investment Research Total gross margin was 76% in the second quarter, down from 77% a year earlier. Material gross margin fell more sharply to 50% from 61%, reflecting lower material sales and mix-related pressure.Management expects material gross margins to move back toward historical levels of approximately 60% in the second half. A return toward that level would provide evidence that the margin pressure seen in the second quarter is easing as product mix and plant utilization improve. The central issue after the quarter is whether weaker material volumes prove temporary. Seasonal product launches, new OLED capacity and broader adoption in IT, automotive and other applications could support demand, but management continues to see uneven conditions across consumer electronics.Gen 8.6 OLED manufacturing is moving into commercial production, while Universal Display continues to develop phosphorescent blue, tandem architectures and AI-driven materials discovery. LG Display Co., Ltd. LPL is also advancing OLED applications in IT and automotive, providing an industry reference for the broader adoption cycle. MKS Inc. MKSI, which supplies process technologies used in flexible and rigid OLED manufacturing, offers another reference to the capital investment taking place across the display-production ecosystem. Universal Display currently carries a Zacks Rank #4 (Sell), with a Value Score of D, Growth Score of F, Momentum Score of C and VGM Score of F. The C Momentum Score provides a modest counterpoint to the weak Growth and VGM readings, but the overall setup remains cautious. Image Source: Zacks Investment Research The Zacks Style Scores are complementary indicators designed to help evaluate value, growth and momentum characteristics, while the Zacks Rank places primary emphasis on earnings estimate revisions. The Style Score framework notes that stocks with Zacks Rank #1 or #2 and A or B Style Scores have historically offered the more favorable setup. For Universal Display, the earnings beat does not remove the revenue shortfall, weaker material volumes or reduced 2026 visibility. A sustained recovery will depend on whether second-half revenue improves as expected and material margins move back toward historical levels. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Universal Display Corporation (OLED) : Free Stock Analysis Report MKS Inc. (MKSI) : Free Stock Analysis Report LG Display Co., Ltd. (LPL) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Image source: The Motley Fool. Thursday, July 30, 2026 at 5:00 p.m. ET Senior Director of Investor Relations - Darice Liu President and Chief Executive Officer - Steven V. Abramson Chief Financial Officer and Treasurer - Brian Millard Operator: Good day, ladies and gentlemen, and welcome to Universal Display Corporation's Second Quarter 26 Earnings Conference Call. My name is Sherry, and I will be your conference moderator for today's call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference call over to Darice Liu, Senior Director of Investor Relations. Please proceed. Darice Liu: Thank you, and good afternoon, everyone. Welcome to Universal Display's second quarter earnings conference call. Joining me on the call today are Steven V. Abramson, President and Chief Executive Officer and Brian Millard, chief financial officer and treasurer. Before Steve begins, let me remind you today's call is a property of Universal Display. Any redistribution, retransmission, or rebroadcast of any portion of this call in any form without the expressed written consent of Universal Display is strictly prohibited. Further, this call is being webcast live and will be made available for a period of time on Universal Display's website. This call contains time sensitive information that is accurate only as of the date of the live webcast of this call July 30, 2026. During this call, we may make forward-looking statements based on current expectations These statements are subject to a number of significant risks and uncertainties and our actual results may differ materially. These risks and uncertainties are discussed in the company's periodic reports filed with the SEC and should be referenced by anyone considering making any investments in the company's securities. Universal Display disclaims any obligation to update any of these statements. Now I would like to turn the call over to Steven V. Abramson. Steven V. Abramson: Thanks, Darice, and good afternoon, everyone. As we look across the OLED industry, we continue to see investment innovation, and expansion throughout the ecosystem. Display manufacturers are investing billions of dollars in new capacity. Brands are broadening adoption across a growing range of products and applications. And next generation technologies continue to push the boundaries of performance and capability. Those developments reflect the industry's long term growth trajectory. Even as portions of the consumer electronics supply chain face a more challenging near term environment. Rising memory costs and supply constraints continue to weigh on demand expectations, particularly within the smartphone market. Where higher component costs are putting pressure on unit volumes. The near term headwinds are reflected in our updated outlook which Brian will discuss in more detail. We believe it is important to separate the current cycle from the longer term direction of the industry. While demand expectations have softened in the near term, we believe the industry's fundamental growth drivers remain firmly intact. Industry forecast call for OLED area growth to be relatively flat this year with positive growth expected to resume in 2027. And many of the investments that will support that next phase of growth are already underway today. After years of planning and development, Gen 8.6 OLED manufacturing is becoming a commercial reality. Samsung Display and BOE recently commenced mass production of the Gen 8.6 facilities, while Visionox and TCL China Star continue advancing their greenfield projects. In addition, LG Display and Samsung Display have announced further Gen 6 investment. Most of these investments target end markets where adoption remains in its early stages. While OLED is already well established in smartphones, with approximately 65% market penetration. IT, automotive, and TVs remain at a much earlier stage with shares still in the low single digits. In automotive, recent introductions such as the Genesis g v 70 Volvo EX 60, and Zeekr 009 demonstrate how OLEDs are driving sophisticated digital cockpits in premium and electric vehicle interiors. Beyond expanding into new applications, 1 of OLED's key advantages is its ability to enable entirely new form factors. Foldable, trifold, and rollable devices are demonstrating how OLED flexibility can unlock new product designs and user experiences. Last week, Samsung unveiled its Galaxy Fold 8 series featuring new flex titanium technology that significantly reduces crease visibility while improving durability. As additional brands enter the market and performance continues to improve, foldables are expected to evolve from a niche category into a more mainstream segment in the years ahead. Collectively, these industry developments highlight the significant runway that remains as OLED expands across new applications, larger display formats, emerging form factors. As adoption broadens, customers continue to demand higher brightness lower power consumption, longer lifetime, broader color gamut, and more advanced display architectures. Meeting these needs requires continued advances in materials and device technologies, which is where our expertise and technology leadership matters most. We are continuing to play a central role in advancing the materials and technology that underpin and drive the industry. Our decades of invention, development, and manufacturing know-how, a portfolio of more than 7 thousand patents, strong customer relationships, and a global support infrastructure position us well as the industry leader entering this next phase of growth. 1 of the most important opportunities on our road map continues to be phosphorescent blue and the meaningful energy efficiency benefit it is expected to deliver. At SID display week in May, we presented additional technical results demonstrating continued progress towards a more robust phosphorescent blue system. Including advances in efficiency, color performance, operational lifetime, and manufacturability. While commercialization timing continues to depend on customer road maps, we believe phosphorescent blue is a significant opportunity for both UDC and the broader industry. Beyond Blue, we continue advancing and broadening our portfolio of next generation OLED technologies, including phosphorescent sensitized fluorescence or PSF, tandem architectures, and innovations designed to enhance light extraction, increase power efficiency, and improve the visual appearance of the display. We look forward to sharing additional technical developments at Korea's IMID conference next month. We are also accelerating materials discovery and development through our internal advanced computational tools, artificial intelligence, machine learning, and agentic AI, as well as strategic collaborations. Including our role as a founding member of CuspAI's recently launched AI Materials Foundry. On the infrastructure front, we continue to invest alongside the OLED industry. Last month, we celebrated the grand opening of our new OLED technology and innovation center in Chengdu, China. As our third innovation tech center in Asia, following Korea and Hong Kong, It reinforces our commitment to providing on the ground local support and fostering collaboration with customers. As we look ahead, we remain confident in the OLED industry's growth trajectory. Continued investment in manufacturing capacity expanding adoption across new applications of form factors and advances in materials and device architectures reinforce our belief that the next growth phase is taking shape. Our investments in innovation and infrastructure, we are helping to build the foundation for that future. And with that, I will turn the call over to Brian. Brian Millard: Thanks, Steven. Revenue for the second quarter of 2026 was $152 million. Compared to $172 million in the second quarter of 2025. As a reminder, the prior year period benefited from elevated customer purchases ahead of anticipated tariff increases. Turning to the broader environment. As Steve shared, we continue to see meaningful investment across the OLED ecosystem and encouraging progress in several long term growth drivers. At the same time, visibility across portions of the consumer electronics supply chain has remained limited. Customer demand forecasts have become more cautious as higher component costs continue to pressure portions of the smartphone market. Given these dynamics, we now expect full year revenue to track toward the lower end of our previous previously communicated range of $630 million to $670 million with second half revenue still expected to exceed first half revenue. Our total material sales in the second quarter were $66 million compared to material sales of $89 million in the second quarter of 2025. The decrease in material sales was primarily driven by lower material volumes customer mix, and changes in cumulative catch up adjustments. Green emitter sales, which include our yellow green emitters, were $51 million. Compared to $64 million in the second quarter of 2025. Red emitter sales were $15 million compared to $24 million in the second quarter of 2025. Revenue from royalty and license fees was $81 million in the second quarter compared to $76 million in the prior year period. The increase was primarily driven by cumulative catch up adjustments. Across both royalty and license revenue and material sales, cumulative catch up adjustments totaled approximately $10 million during the second quarter and the first 6 months of 2026. And had a net favorable impact of approximately $9 million compared to the second quarter of 2025. The ratio of material sales to royalty and license revenue during the second quarter was approximately 0.8 to 1. When you look at the first half of the year, the ratio was approximately 1.1 to 1. Based on our current outlook, we now expect the full year ratio to average approximately 1.2 to 1. Adhesus generated $4.8 million of revenue during the quarter, compared to $7.5 million in the second quarter of 2025. Cost of sales was $37 million for the quarter. Total gross margin was 76%. Compared to 77% in the second quarter of 2025. Operating expenses, excluding cost of sales, were $62 million compared to $64 million in the prior year period. We continue to operate as a lean company, investing in key R&D and growth initiatives while maintaining a disciplined approach to spending. Based on our current outlook, we now expect full year operating expenses to increase by a low single digit percentage compared to 2025. Operating income for the quarter was $54 million representing an operating margin of 35%. This compares to the prior year period of $69 million and an operating margin of 40% The effective tax rate for the quarter was approximately 19%. Net income was $49 million or $1.06 per diluted share, compared to net income of $67 million or $1.41 per diluted share in the second quarter of 2025. Our business continues to generate strong cash flow and maintain significant financial flexibility. During the second quarter, we repurchased approximately 531 thousand shares for approximately $48 million. Over the last 12 months, we returned more than $238 million to shareholders through dividends and share repurchases. Today, we announced that our board of directors declared a third quarter cash dividend of $0.50 per share. We ended the quarter with approximately $855 million in cash, cash equivalents and investments. Providing substantial flexibility to invest in innovation, pursue growth opportunities, and continue returning capital to shareholders. Our strong balance sheet and cash flow generation position us well to support both our near term priorities and long term growth initiatives. With that, I will turn the call back to Steven. Steven V. Abramson: Thanks, Brian. We are excited about the opportunities ahead. OLED continues to expand into new applications new products, and new form factors. The technology road map also continues to advance, creating new opportunities across the ecosystem. As an OLED pioneer, we have helped shape the industry through scientific leadership intellectual property, and close collaboration with our customers and partners. We believe those strengths, together with our robust R&D pipeline, global infrastructure, and strong balance sheet position us well for the future. I would like to thank each of our employees for their drive desire, dedication, and heart in elevating and shaping Universal Display's accomplishments and advancements. We are committed to being a leader in the OLED ecosystem. Achieving superior long term growth and delivering cutting edge technologies and materials for the industry, for our customers, and for our shareholders. With that, operator, let's start the Q&A session. Operator: Thank you, Mr. Abramson. You may press 2 if you would like to remove your question from the queue. Before pressing the star keys. Our first question comes from Jim Ricchiuti with Needham and Company. Please proceed. James Ricchiuti: Thank you. Good afternoon. I know there is probably some noise in those materials margins that were in the second quarter I am wondering, do you should we anticipate a return to more normalized material margins in the second half? Brian Millard: Yeah. Hi, Jim. Yeah. As you noted, there was a little bit of anomaly in the second quarter. We did as we went through our reforecasting process, we did-- we do now assume that there is going to be a change in a bit of in some of the materials mix and the product mix. And so as a result of that, there was roughly a $7 million reduction recorded compared to where we were in Q2 of last year. So it was a negative item hitting the materials line in the second quarter. And we do expect in the remainder of the year, our Materials gross margins to return more toward their historical levels which have been approximately 60%. James Ricchiuti: Got it. And are you able to say if your revenues if you expect your revenues to benefit in any meaningful way from the new capacity that you alluded to in the press release and your introductory comments. In the second half? Or is this realistically, is this more likely to be a catalyst for you next year? Steven V. Abramson: There certainly is some benefit we are seeing in 2026 in the second half and even in the first half as those fabs are getting ready for mass production. And that is already encompassed in our guidance for this year. Next year we certainly and, you know, in 2027 and beyond, even more benefit as those fabs are fully operational and mass production scale for a full 12 months. Each year as well as, more heavily utilized in the coming years. So 2026 is really setting up, you know, the opportunity for growth in the next few years. Operator: Our next question is from Mehdi Hosseini with SIG. Please proceed. Mehdi Hosseini: Yes. Thanks for taking my question. I want to go back to Steven. This is obviously a recurring question every quarter. And I am just going to ask you, is there any more detail as to how you are progressing with commercialization of the blue Has the reliability and the yield and the lifetime improved to the point that we are just waiting for commercial adoption at a larger scale, or is there still some milestones that you need to meet before commercialization of the end market product? Steven V. Abramson: Well, Mehdi, as you know, phosphorescent blue is 1 of our most important opportunities. And we have made meaningful progress in the earlier developmental materials achieved some key milestones. And work is continuing on those programs and you saw the announcement about from LG on the iPad. But you know, as the industry has evolved, we have seen multiple pathways emerging for phosphorescent commercial blue OLEDs. And so we are expanding our efforts across a broader range of next generation blue materials and architecture. So we are accelerating the development, increasing resources behind the program, including leveraging our AI machine learning to expand the design space and accelerate materials discovery and development. We remain confident in the long term commercial opportunity for phosphorescent blue. But, again, I cannot give you any specific timelines right now because that is really dependent on our customers' commercial road maps. Brian Millard: Yeah. And, Mehdi, you know, as you are aware, in 2025, LG at SID display week showcased a tablet sized product that had incorporated phosphorescent blue in a hybrid tandem structure. So it was a tablet you know, size product, and they did re showcase at this year's SID display week a similar prototype that they developed. So we are very encouraged by progress that we see LG making and talking about very publicly as well as progress that other customers have made as well that have not have, you know, now gotten to a point of being prototypes that they are able to, showcase with others in the industry. Mehdi Hosseini: Got it. Thanks for detail. If I may just have a follow-up here. Could there be a scenario where increased emphasis on power consumption or reduction in power consumption make the blue a more viable solution for the next generation of the gaming laptop or even to that extent, a more sophisticated AI notebooks that would come into the market next year. Operator: Oh, go ahead. Steven V. Abramson: The more the emphasis is on power efficiency, the more important is our blue phosphorescence. But the next year comment, I am going to hold on to. Mehdi Hosseini: Gotcha. Thank you. Operator: Our next question is from Scott Searle with ROTH Capital Partners. Scott Searle: Please Hey, good afternoon. Thanks for taking the questions. Steven and Brian, maybe to dive in, in terms of guidance for the year. Even at the lower end of the range, it still implies a meaningful step-up into the second half of this year. Think an average of $168 million ish in revenue per quarter. I am wondering where you are seeing the strength? What level of confidence is in that? Certainly, it sounds like you have got some early production that is going on with some of the new fabs. But I am wondering if you could update us in terms of where you think channel inventories are and kind of what is driving that comfort and outlook into the second half? Brian Millard: Yeah. Hi, Scott. So in the second half, as you are aware, there is a number of products that launch in Q3, as well as early Q1. That we, you will typically see a stronger second half in most years in our business, and we expect that trend this year as well. So on the visibility we have right now at the product cycles, and the details that we are receiving from customers in terms of their forecast, we do expect the second half to be to be stronger than the first half, which has really been our expectation all along this year. We have, since the beginning of the year, expected that, the second half was going to be stronger, and that continues to be the case today. Scott Searle: Gotcha. Very helpful. Thank you. And if I could just to follow-up specifically on some of the geographic mix, I think China took a nice tick up in the second quarter. Are we getting back to a more normalized level of China revenues? Or is this some more pre buying ahead of second round of tariffs or just new production coming online for BA? Any color on that front would be helpful. And just to clarify on the gross margins, Brian, I want to make sure I heard correctly. Materials gross margins recovering back to the 60% level. In the second half after some of the anomalies that we saw in the second quarter? Brian Millard: Yes. that is right on the materials gross margins. We do expect the second half to be more normal, you know, near our historical trends, which have been around 60% in recent quarters. There were some anomalies in Q2 that drove the Materials gross margin being lower. As it relates to China, our China sales have always been very lumpy. Historically, and that continues to be the case. But we are projecting growth in Chinese customer revenues in the second half. And I would say, we are seeing customers who are more exposed to the mid and low end segments of the smartphone market. there is just a little more pressure on those customers this year. But we are projecting growth in the second half. Scott Searle: Thanks so much. I will get back in the queue. Thanks, Scott. Operator: As a reminder, just *1 on your telephone keypad if you would like to ask a question. Our next question is from Nam Kim with Equity Research. Please proceed. Nam Kim: Hello. Thank you for taking my question. I think the guidance adjustment, I guess, you know, may be due to a bit slower material growth trend. Is this driven by lower unit volume or ASP pressure or combination of both? I mean, IT OLED demand, especially gaming monitor, seems very strong. But smartphone demand is weak. So could you help me understand, overall unit impact across your, end market? And also, given the rising cost of across the industry, are you seeing any price pressure on your OLED material? Or has your material pricing remained relatively stable? Thank you. Brian Millard: Yeah. Hi, Nam. The change in the guidance now expecting us to be toward the low end of the prior range, that is really driven by a change in volume expectation. As you are aware, we have long term, you know, typically 5 year deals with our customers. So we have very consistent ASPs over those periods, and we have not seen anything out of the ordinary on the pricing side. And so that, you know, it is really driven by a lower expectation of, of volume this year. Nam Kim: K. Thank you. Operator: Our next question is from Martin Yang with Oppenheimer and Company. Please proceed. Martin Yang: Hi. Thank you for taking my question. Hi. Thank you for taking my question. A follow-up on the previous topic on growth in the second half. Do you expect growth in the second half across all of your customers? Hi, Martin. Brian Millard: Yeah. We are projecting growth across our customers in the second half. So, there is product cycles that we expect we will benefit from in the second half as well as we are projecting across the board growth in the in the customer base based on a broad basis in the second half. Martin Yang: Got it. Second question on gross margin. Looking to maybe a more medium term perspective, do you think we will see incremental gross margin headwind in 2027 based on raw material costs And do you have any potential offset to those potential headwinds? Brian Millard: Yeah. So on gross margin, I think, you know, it is important to focus on total gross margins is the much more useful way in our view of a assessing our profitability. And our guidance this year for total gross margins is 74% to 76%. And on a year to date basis, we are tracking right in line with that at just north of 75%. And in terms of 2027, too early to give a guide or expectation there. We do have certain input costs, into our manufacturing process. 1 of the key ones being iridium, which is a key component of many of our products. That has fluctuated in price recently. On the other side, you know, as we can put more volume through, the fixed components of our manufacturing plants, we are able to achieve, you know, greater operating leverage there. So we will give more color in February about what that means for next year, but we are certainly very focused on the sourcing side of things, making sure that we are sourcing our raw materials and inputs in the most efficient and cost effective way. And, you know, working with PPG as well to make sure that the manufacturing processes are optimized to the to the greatest extent. Martin Yang: Got it. Last question. The sales of blue sample materials have stayed at a very low level in past few quarters. Can you maybe comment on what should we interpret as lower level of sample sales versus the past few quarters or the same time last year? And what we should expect for the rest of this year? Thank you. Brian Millard: Yeah. So I think that the blue development sales have been low as you noted in the last couple of quarters, but the progress with our customers continues to move positively in the right direction. When in an R&D stage and development cycle that they are in, a little bit of material can go a long way. And we are also, as Steven noted, continuing to focus our resources on inventing new materials and providing those to customers to, you know, open even more doors for them in Blue Development. So, the number is certain the revenue number is certainly, you know, an interesting anecdote, but it is not necessarily the best way of measuring the progress that we are making, in moving closer to commercialization of blue. Martin Yang: Got it. Thank you, Brian. that is it for me. Thanks. Operator: Thank you. This concludes the question-and-answer session. I would like to turn the program back over to Brian Millard for any additional or closing remarks. Brian Millard: Thanks for joining us today. We are confident in the underlying growth drivers for UDC and the OLED industry. We appreciate your continued support and look forward to speaking with you again next quarter. Thank you. Operator: This concludes today's conference call. You may now disconnect. Before you buy stock in Universal Display, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Universal Display wasn’t one of them. The 10 stocks that made the cut are built for long-term growth and could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Universal Display. The Motley Fool has a disclosure policy. Universal Display (OLED) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

Interested in Universal Display Corporation? Here are five stocks we like better. Second-quarter results weakened: Revenue fell to $152 million from $172 million, while net income declined to $49 million from $67 million, pressured by softer material volumes and customer mix. Full-year revenue is expected near the lower end of the previously issued $630 million–$670 million range as higher component costs weigh on smartphone demand. Management still expects second-half revenue to exceed first-half revenue and material margins to recover toward historical levels. Management remains focused on longer-term OLED growth from new manufacturing capacity, expanded adoption in IT, automotive and television displays, and emerging form factors. Phosphorescent blue OLED remains a key development priority, though the company provided no commercialization timeline. Universal Display (NASDAQ:OLED) reported lower second-quarter revenue and earnings as softer material volumes and customer mix weighed on results, while management said it remains confident that new OLED manufacturing capacity and broader adoption across applications will support longer-term growth. Second-quarter revenue was $152 million, down from $172 million a year earlier. Chief Financial Officer Brian Millard noted that the prior-year period benefited from elevated customer purchases ahead of anticipated tariff increases. → Why SK hynix Could Be the Best AI Chip Stock to Buy Now Net income declined to $49 million, or $1.06 per diluted share, from $67 million, or $1.41 per diluted share, in the second quarter of 2025. Operating income was $54 million, compared with $69 million in the prior-year period, while operating margin fell to 35% from 40%. Management now expects full-year revenue to track toward the lower end of its previously communicated $630 million to $670 million range. Millard said customer demand forecasts have become more cautious as rising component costs pressure portions of the smartphone market. → Microsoft Just Flipped the AI Spending Narrative Overnight The revised outlook reflects lower expected sales volumes rather than pricing pressure, according to Millard. He said the company generally has long-term agreements with customers and has not seen unusual changes in average selling prices. Despite the more cautious full-year outlook, Universal Display expects second-half revenue to exceed first-half revenue. Millard said the company typically benefits from product launches in the third quarter and early first quarter, and it expects growth across its customer base during the second half. → Carrier Earnings Could Send the Stock to a New All-Time High “2026 is really setting up the opportunity for growth in the next few years,” Millard said, citing newly commissioned OLED facilities that are expected to contribute more meaningfully as they reach full-year mass-production scale and higher utilization. Total material sales fell to $66 million in the second quarter from $89 million a year earlier. The decline reflected lower material volumes, customer mix and changes in cumulative catch-up adjustments. Green emitter sales were $51 million, compared with $64 million a year earlier. Red emitter sales were $15 million, down from $24 million. Royalty and license revenue rose to $81 million from $76 million, primarily due to cumulative catch-up adjustments. Adesis revenue was $4.8 million, compared with $7.5 million in the prior-year quarter. Cumulative catch-up adjustments across material sales and royalty and license revenue totaled about $10 million in the quarter. During the first six months of 2026, those adjustments had a net favorable impact of about $9 million compared with the second quarter of 2025, Millard said. Total gross margin was 76%, compared with 77% a year earlier. Millard said material gross margin was affected by an approximately $7 million negative item tied to changes in materials and product mix during the company’s reforecasting process. He expects material gross margins to return closer to their historical level of approximately 60% during the second half. For the full year, the company continues to expect total gross margin of 74% to 76%. Operating expenses excluding cost of sales were $62 million, down from $64 million a year earlier, and Universal Display expects full-year operating expenses to increase by a low single-digit percentage from 2025. President and Chief Executive Officer Steve Abramson said OLED industry demand expectations have softened near term, but he believes the longer-term growth drivers remain intact. Industry forecasts call for OLED area growth to be relatively flat this year before returning to positive growth in 2027, he said. Samsung Display and BOE have begun mass production at Generation 8.6 OLED facilities, Abramson said, while Visionox and TCL China Star are advancing greenfield projects. LG Display and Samsung Display have also announced additional Generation 6 investments. Management highlighted IT, automotive and television displays as markets where OLED adoption remains in the low single digits, compared with approximately 65% penetration in smartphones. Abramson also pointed to foldable, trifold and rollable devices as categories that could broaden OLED adoption and enable new product designs. Universal Display opened an OLED Technology and Innovation Center in Chengdu, China, during the quarter. The location is the company’s third innovation technology center in Asia, following facilities in Korea and Hong Kong. Universal Display continues to pursue commercialization of phosphorescent blue OLED technology, which management believes could deliver meaningful energy-efficiency benefits. Abramson said the company presented additional technical results at SID Display Week in May, including progress in efficiency, color performance, operational lifetime and manufacturability. However, he did not provide a commercialization timeline, saying adoption depends on customer product roadmaps. The company is expanding development efforts across a broader range of blue materials and architectures and is using computational tools, artificial intelligence and machine learning to accelerate materials discovery. Millard said blue development-material sales have been low in recent quarters, but he cautioned that sample-sales revenue is not necessarily the best measure of progress because limited quantities can support research and development work. He also cited prototypes publicly displayed by LG that incorporated phosphorescent blue in a hybrid tandem structure. Universal Display ended the quarter with approximately $855 million in cash, cash equivalents and investments. During the quarter, it repurchased about 531,000 shares for approximately $48 million. The board declared a third-quarter cash dividend of $0.50 per share. Universal Display Corporation (NASDAQ: OLED) is a technology company specializing in organic light-emitting diode (OLED) solutions. The company develops and commercializes materials, technologies and software used in the creation of OLED displays and lighting. Its offerings include proprietary phosphorescent OLED (PHOLED) materials, display driver integrated circuits and process technologies that enable higher efficiency, longer lifetimes and improved color performance for a range of display and lighting applications. Universal Display's core business is licensing its extensive OLED patent portfolio to display manufacturers and providing them with the key organic materials needed for device fabrication. This instant news alert was generated by narrative science technology and financial data from MarketBeat in order to provide readers with the fastest reporting and unbiased coverage. Please send any questions or comments about this story to [email protected]. The article "Universal Display Q2 Earnings Call Highlights" was originally published by MarketBeat. View MarketBeat's top stocks for July 2026.

Image source: The Motley Fool. Thursday, July 30, 2026 at 5:00 p.m. ET Senior Director of Investor Relations - Darice Liu President and Chief Executive Officer - Steven V. Abramson Chief Financial Officer and Treasurer - Brian Millard Operator: Good day, ladies and gentlemen, and welcome to Universal Display Corporation's Second Quarter 26 Earnings Conference Call. My name is Sherry, and I will be your conference moderator for today's call. At this time, all participants are in a listen-only mode. A question-and-answer session will follow the formal presentation. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the conference call over to Darice Liu, Senior Director of Investor Relations. Please proceed. Darice Liu: Thank you, and good afternoon, everyone. Welcome to Universal Display's second quarter earnings conference call. Joining me on the call today are Steven V. Abramson, President and Chief Executive Officer and Brian Millard, chief financial officer and treasurer. Before Steve begins, let me remind you today's call is a property of Universal Display. Any redistribution, retransmission, or rebroadcast of any portion of this call in any form without the expressed written consent of Universal Display is strictly prohibited. Further, this call is being webcast live and will be made available for a period of time on Universal Display's website. This call contains time sensitive information that is accurate only as of the date of the live webcast of this call July 30, 2026. During this call, we may make forward-looking statements based on current expectations These statements are subject to a number of significant risks and uncertainties and our actual results may differ materially. These risks and uncertainties are discussed in the company's periodic reports filed with the SEC and should be referenced by anyone considering making any investments in the company's securities. Universal Display disclaims any obligation to update any of these statements. Now I would like to turn the call over to Steven V. Abramson. Steven V. Abramson: Thanks, Darice, and good afternoon, everyone. As we look across the OLED industry, we continue to see investment innovation, and expansion throughout the ecosystem. Display manufacturers are investing billions of dollars in new capacity. Brands are broadening adoption across a growing range of products and applications. And next generation technologies continue to push the boundaries of performance and capability. Those developments reflect the industry's long term growth trajectory. Even as portions of the consumer electronics supply chain face a more challenging near term environment. Rising memory costs and supply constraints continue to weigh on demand expectations, particularly within the smartphone market. Where higher component costs are putting pressure on unit volumes. The near term headwinds are reflected in our updated outlook which Brian will discuss in more detail. We believe it is important to separate the current cycle from the longer term direction of the industry. While demand expectations have softened in the near term, we believe the industry's fundamental growth drivers remain firmly intact. Industry forecast call for OLED area growth to be relatively flat this year with positive growth expected to resume in 2027. And many of the investments that will support that next phase of growth are already underway today. After years of planning and development, Gen 8.6 OLED manufacturing is becoming a commercial reality. Samsung Display and BOE recently commenced mass production of the Gen 8.6 facilities, while Visionox and TCL China Star continue advancing their greenfield projects. In addition, LG Display and Samsung Display have announced further Gen 6 investment. Most of these investments target end markets where adoption remains in its early stages. While OLED is already well established in smartphones, with approximately 65% market penetration. IT, automotive, and TVs remain at a much earlier stage with shares still in the low single digits. In automotive, recent introductions such as the Genesis g v 70 Volvo EX 60, and Zeekr 009 demonstrate how OLEDs are driving sophisticated digital cockpits in premium and electric vehicle interiors. Beyond expanding into new applications, 1 of OLED's key advantages is its ability to enable entirely new form factors. Foldable, trifold, and rollable devices are demonstrating how OLED flexibility can unlock new product designs and user experiences. Last week, Samsung unveiled its Galaxy Fold 8 series featuring new flex titanium technology that significantly reduces crease visibility while improving durability. As additional brands enter the market and performance continues to improve, foldables are expected to evolve from a niche category into a more mainstream segment in the years ahead. Collectively, these industry developments highlight the significant runway that remains as OLED expands across new applications, larger display formats, emerging form factors. As adoption broadens, customers continue to demand higher brightness lower power consumption, longer lifetime, broader color gamut, and more advanced display architectures. Meeting these needs requires continued advances in materials and device technologies, which is where our expertise and technology leadership matters most. We are continuing to play a central role in advancing the materials and technology that underpin and drive the industry. Our decades of invention, development, and manufacturing know-how, a portfolio of more than 7 thousand patents, strong customer relationships, and a global support infrastructure position us well as the industry leader entering this next phase of growth. 1 of the most important opportunities on our road map continues to be phosphorescent blue and the meaningful energy efficiency benefit it is expected to deliver. At SID display week in May, we presented additional technical results demonstrating continued progress towards a more robust phosphorescent blue system. Including advances in efficiency, color performance, operational lifetime, and manufacturability. While commercialization timing continues to depend on customer road maps, we believe phosphorescent blue is a significant opportunity for both UDC and the broader industry. Beyond Blue, we continue advancing and broadening our portfolio of next generation OLED technologies, including phosphorescent sensitized fluorescence or PSF, tandem architectures, and innovations designed to enhance light extraction, increase power efficiency, and improve the visual appearance of the display. We look forward to sharing additional technical developments at Korea's IMID conference next month. We are also accelerating materials discovery and development through our internal advanced computational tools, artificial intelligence, machine learning, and agentic AI, as well as strategic collaborations. Including our role as a founding member of CuspAI's recently launched AI Materials Foundry. On the infrastructure front, we continue to invest alongside the OLED industry. Last month, we celebrated the grand opening of our new OLED technology and innovation center in Chengdu, China. As our third innovation tech center in Asia, following Korea and Hong Kong, It reinforces our commitment to providing on the ground local support and fostering collaboration with customers. As we look ahead, we remain confident in the OLED industry's growth trajectory. Continued investment in manufacturing capacity expanding adoption across new applications of form factors and advances in materials and device architectures reinforce our belief that the next growth phase is taking shape. Our investments in innovation and infrastructure, we are helping to build the foundation for that future. And with that, I will turn the call over to Brian. Brian Millard: Thanks, Steven. Revenue for the second quarter of 2026 was $152 million. Compared to $172 million in the second quarter of 2025. As a reminder, the prior year period benefited from elevated customer purchases ahead of anticipated tariff increases. Turning to the broader environment. As Steve shared, we continue to see meaningful investment across the OLED ecosystem and encouraging progress in several long term growth drivers. At the same time, visibility across portions of the consumer electronics supply chain has remained limited. Customer demand forecasts have become more cautious as higher component costs continue to pressure portions of the smartphone market. Given these dynamics, we now expect full year revenue to track toward the lower end of our previous previously communicated range of $630 million to $670 million with second half revenue still expected to exceed first half revenue. Our total material sales in the second quarter were $66 million compared to material sales of $89 million in the second quarter of 2025. The decrease in material sales was primarily driven by lower material volumes customer mix, and changes in cumulative catch up adjustments. Green emitter sales, which include our yellow green emitters, were $51 million. Compared to $64 million in the second quarter of 2025. Red emitter sales were $15 million compared to $24 million in the second quarter of 2025. Revenue from royalty and license fees was $81 million in the second quarter compared to $76 million in the prior year period. The increase was primarily driven by cumulative catch up adjustments. Across both royalty and license revenue and material sales, cumulative catch up adjustments totaled approximately $10 million during the second quarter and the first 6 months of 2026. And had a net favorable impact of approximately $9 million compared to the second quarter of 2025. The ratio of material sales to royalty and license revenue during the second quarter was approximately 0.8 to 1. When you look at the first half of the year, the ratio was approximately 1.1 to 1. Based on our current outlook, we now expect the full year ratio to average approximately 1.2 to 1. Adhesus generated $4.8 million of revenue during the quarter, compared to $7.5 million in the second quarter of 2025. Cost of sales was $37 million for the quarter. Total gross margin was 76%. Compared to 77% in the second quarter of 2025. Operating expenses, excluding cost of sales, were $62 million compared to $64 million in the prior year period. We continue to operate as a lean company, investing in key R&D and growth initiatives while maintaining a disciplined approach to spending. Based on our current outlook, we now expect full year operating expenses to increase by a low single digit percentage compared to 2025. Operating income for the quarter was $54 million representing an operating margin of 35%. This compares to the prior year period of $69 million and an operating margin of 40% The effective tax rate for the quarter was approximately 19%. Net income was $49 million or $1.06 per diluted share, compared to net income of $67 million or $1.41 per diluted share in the second quarter of 2025. Our business continues to generate strong cash flow and maintain significant financial flexibility. During the second quarter, we repurchased approximately 531 thousand shares for approximately $48 million. Over the last 12 months, we returned more than $238 million to shareholders through dividends and share repurchases. Today, we announced that our board of directors declared a third quarter cash dividend of $0.50 per share. We ended the quarter with approximately $855 million in cash, cash equivalents and investments. Providing substantial flexibility to invest in innovation, pursue growth opportunities, and continue returning capital to shareholders. Our strong balance sheet and cash flow generation position us well to support both our near term priorities and long term growth initiatives. With that, I will turn the call back to Steven. Steven V. Abramson: Thanks, Brian. We are excited about the opportunities ahead. OLED continues to expand into new applications new products, and new form factors. The technology road map also continues to advance, creating new opportunities across the ecosystem. As an OLED pioneer, we have helped shape the industry through scientific leadership intellectual property, and close collaboration with our customers and partners. We believe those strengths, together with our robust R&D pipeline, global infrastructure, and strong balance sheet position us well for the future. I would like to thank each of our employees for their drive desire, dedication, and heart in elevating and shaping Universal Display's accomplishments and advancements. We are committed to being a leader in the OLED ecosystem. Achieving superior long term growth and delivering cutting edge technologies and materials for the industry, for our customers, and for our shareholders. With that, operator, let's start the Q&A session. Operator: Thank you, Mr. Abramson. You may press 2 if you would like to remove your question from the queue. Before pressing the star keys. Our first question comes from Jim Ricchiuti with Needham and Company. Please proceed. James Ricchiuti: Thank you. Good afternoon. I know there is probably some noise in those materials margins that were in the second quarter I am wondering, do you should we anticipate a return to more normalized material margins in the second half? Brian Millard: Yeah. Hi, Jim. Yeah. As you noted, there was a little bit of anomaly in the second quarter. We did as we went through our reforecasting process, we did-- we do now assume that there is going to be a change in a bit of in some of the materials mix and the product mix. And so as a result of that, there was roughly a $7 million reduction recorded compared to where we were in Q2 of last year. So it was a negative item hitting the materials line in the second quarter. And we do expect in the remainder of the year, our Materials gross margins to return more toward their historical levels which have been approximately 60%. James Ricchiuti: Got it. And are you able to say if your revenues if you expect your revenues to benefit in any meaningful way from the new capacity that you alluded to in the press release and your introductory comments. In the second half? Or is this realistically, is this more likely to be a catalyst for you next year? Steven V. Abramson: There certainly is some benefit we are seeing in 2026 in the second half and even in the first half as those fabs are getting ready for mass production. And that is already encompassed in our guidance for this year. Next year we certainly and, you know, in 2027 and beyond, even more benefit as those fabs are fully operational and mass production scale for a full 12 months. Each year as well as, more heavily utilized in the coming years. So 2026 is really setting up, you know, the opportunity for growth in the next few years. Operator: Our next question is from Mehdi Hosseini with SIG. Please proceed. Mehdi Hosseini: Yes. Thanks for taking my question. I want to go back to Steven. This is obviously a recurring question every quarter. And I am just going to ask you, is there any more detail as to how you are progressing with commercialization of the blue Has the reliability and the yield and the lifetime improved to the point that we are just waiting for commercial adoption at a larger scale, or is there still some milestones that you need to meet before commercialization of the end market product? Steven V. Abramson: Well, Mehdi, as you know, phosphorescent blue is 1 of our most important opportunities. And we have made meaningful progress in the earlier developmental materials achieved some key milestones. And work is continuing on those programs and you saw the announcement about from LG on the iPad. But you know, as the industry has evolved, we have seen multiple pathways emerging for phosphorescent commercial blue OLEDs. And so we are expanding our efforts across a broader range of next generation blue materials and architecture. So we are accelerating the development, increasing resources behind the program, including leveraging our AI machine learning to expand the design space and accelerate materials discovery and development. We remain confident in the long term commercial opportunity for phosphorescent blue. But, again, I cannot give you any specific timelines right now because that is really dependent on our customers' commercial road maps. Brian Millard: Yeah. And, Mehdi, you know, as you are aware, in 2025, LG at SID display week showcased a tablet sized product that had incorporated phosphorescent blue in a hybrid tandem structure. So it was a tablet you know, size product, and they did re showcase at this year's SID display week a similar prototype that they developed. So we are very encouraged by progress that we see LG making and talking about very publicly as well as progress that other customers have made as well that have not have, you know, now gotten to a point of being prototypes that they are able to, showcase with others in the industry. Mehdi Hosseini: Got it. Thanks for detail. If I may just have a follow-up here. Could there be a scenario where increased emphasis on power consumption or reduction in power consumption make the blue a more viable solution for the next generation of the gaming laptop or even to that extent, a more sophisticated AI notebooks that would come into the market next year. Operator: Oh, go ahead. Steven V. Abramson: The more the emphasis is on power efficiency, the more important is our blue phosphorescence. But the next year comment, I am going to hold on to. Mehdi Hosseini: Gotcha. Thank you. Operator: Our next question is from Scott Searle with ROTH Capital Partners. Scott Searle: Please Hey, good afternoon. Thanks for taking the questions. Steven and Brian, maybe to dive in, in terms of guidance for the year. Even at the lower end of the range, it still implies a meaningful step-up into the second half of this year. Think an average of $168 million ish in revenue per quarter. I am wondering where you are seeing the strength? What level of confidence is in that? Certainly, it sounds like you have got some early production that is going on with some of the new fabs. But I am wondering if you could update us in terms of where you think channel inventories are and kind of what is driving that comfort and outlook into the second half? Brian Millard: Yeah. Hi, Scott. So in the second half, as you are aware, there is a number of products that launch in Q3, as well as early Q1. That we, you will typically see a stronger second half in most years in our business, and we expect that trend this year as well. So on the visibility we have right now at the product cycles, and the details that we are receiving from customers in terms of their forecast, we do expect the second half to be to be stronger than the first half, which has really been our expectation all along this year. We have, since the beginning of the year, expected that, the second half was going to be stronger, and that continues to be the case today. Scott Searle: Gotcha. Very helpful. Thank you. And if I could just to follow-up specifically on some of the geographic mix, I think China took a nice tick up in the second quarter. Are we getting back to a more normalized level of China revenues? Or is this some more pre buying ahead of second round of tariffs or just new production coming online for BA? Any color on that front would be helpful. And just to clarify on the gross margins, Brian, I want to make sure I heard correctly. Materials gross margins recovering back to the 60% level. In the second half after some of the anomalies that we saw in the second quarter? Brian Millard: Yes. that is right on the materials gross margins. We do expect the second half to be more normal, you know, near our historical trends, which have been around 60% in recent quarters. There were some anomalies in Q2 that drove the Materials gross margin being lower. As it relates to China, our China sales have always been very lumpy. Historically, and that continues to be the case. But we are projecting growth in Chinese customer revenues in the second half. And I would say, we are seeing customers who are more exposed to the mid and low end segments of the smartphone market. there is just a little more pressure on those customers this year. But we are projecting growth in the second half. Scott Searle: Thanks so much. I will get back in the queue. Thanks, Scott. Operator: As a reminder, just *1 on your telephone keypad if you would like to ask a question. Our next question is from Nam Kim with Equity Research. Please proceed. Nam Kim: Hello. Thank you for taking my question. I think the guidance adjustment, I guess, you know, may be due to a bit slower material growth trend. Is this driven by lower unit volume or ASP pressure or combination of both? I mean, IT OLED demand, especially gaming monitor, seems very strong. But smartphone demand is weak. So could you help me understand, overall unit impact across your, end market? And also, given the rising cost of across the industry, are you seeing any price pressure on your OLED material? Or has your material pricing remained relatively stable? Thank you. Brian Millard: Yeah. Hi, Nam. The change in the guidance now expecting us to be toward the low end of the prior range, that is really driven by a change in volume expectation. As you are aware, we have long term, you know, typically 5 year deals with our customers. So we have very consistent ASPs over those periods, and we have not seen anything out of the ordinary on the pricing side. And so that, you know, it is really driven by a lower expectation of, of volume this year. Nam Kim: K. Thank you. Operator: Our next question is from Martin Yang with Oppenheimer and Company. Please proceed. Martin Yang: Hi. Thank you for taking my question. Hi. Thank you for taking my question. A follow-up on the previous topic on growth in the second half. Do you expect growth in the second half across all of your customers? Hi, Martin. Brian Millard: Yeah. We are projecting growth across our customers in the second half. So, there is product cycles that we expect we will benefit from in the second half as well as we are projecting across the board growth in the in the customer base based on a broad basis in the second half. Martin Yang: Got it. Second question on gross margin. Looking to maybe a more medium term perspective, do you think we will see incremental gross margin headwind in 2027 based on raw material costs And do you have any potential offset to those potential headwinds? Brian Millard: Yeah. So on gross margin, I think, you know, it is important to focus on total gross margins is the much more useful way in our view of a assessing our profitability. And our guidance this year for total gross margins is 74% to 76%. And on a year to date basis, we are tracking right in line with that at just north of 75%. And in terms of 2027, too early to give a guide or expectation there. We do have certain input costs, into our manufacturing process. 1 of the key ones being iridium, which is a key component of many of our products. That has fluctuated in price recently. On the other side, you know, as we can put more volume through, the fixed components of our manufacturing plants, we are able to achieve, you know, greater operating leverage there. So we will give more color in February about what that means for next year, but we are certainly very focused on the sourcing side of things, making sure that we are sourcing our raw materials and inputs in the most efficient and cost effective way. And, you know, working with PPG as well to make sure that the manufacturing processes are optimized to the to the greatest extent. Martin Yang: Got it. Last question. The sales of blue sample materials have stayed at a very low level in past few quarters. Can you maybe comment on what should we interpret as lower level of sample sales versus the past few quarters or the same time last year? And what we should expect for the rest of this year? Thank you. Brian Millard: Yeah. So I think that the blue development sales have been low as you noted in the last couple of quarters, but the progress with our customers continues to move positively in the right direction. When in an R&D stage and development cycle that they are in, a little bit of material can go a long way. And we are also, as Steven noted, continuing to focus our resources on inventing new materials and providing those to customers to, you know, open even more doors for them in Blue Development. So, the number is certain the revenue number is certainly, you know, an interesting anecdote, but it is not necessarily the best way of measuring the progress that we are making, in moving closer to commercialization of blue. Martin Yang: Got it. Thank you, Brian. that is it for me. Thanks. Operator: Thank you. This concludes the question-and-answer session. I would like to turn the program back over to Brian Millard for any additional or closing remarks. Brian Millard: Thanks for joining us today. We are confident in the underlying growth drivers for UDC and the OLED industry. We appreciate your continued support and look forward to speaking with you again next quarter. Thank you. Operator: This concludes today's conference call. You may now disconnect. Before you buy stock in Universal Display, consider this: The Motley Fool Stock Advisor analyst team just identified what they believe are the 10 best stocks for investors to buy now… and Universal Display wasn’t one of them. The 10 stocks that made the cut could produce monster returns in the coming years. 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As with all our articles, The Motley Fool does not assume any responsibility for your use of this content, and we strongly encourage you to do your own research, including listening to the call yourself and reading the company's SEC filings. Please see our Terms and Conditions for additional details, including our Obligatory Capitalized Disclaimers of Liability. The Motley Fool recommends Universal Display. The Motley Fool has a disclosure policy. Universal Display (OLED) Q2 2026 Earnings Call Transcript was originally published by The Motley Fool

This article first appeared on GuruFocus. Revenue: $152 million in Q2 2026, down from $172 million in Q2 2025. Material Sales: $66 million in Q2 2026, down from $89 million in Q2 2025. Green Emitter Sales: $51 million in Q2 2026, down from $64 million in Q2 2025. Red Emitter Sales: $15 million in Q2 2026, down from $24 million in Q2 2025. Royalty and License Fees: $81 million in Q2 2026, up from $76 million in Q2 2025. Adesis Revenue: $4.8 million in Q2 2026, down from $7.5 million in Q2 2025. Gross Margin: 76% in Q2 2026, compared to 77% in Q2 2025. Operating Income: $54 million in Q2 2026, with an operating margin of 35%, down from $69 million and 40% in Q2 2025. Net Income: $49 million, or $1.06 per diluted share, in Q2 2026, down from $67 million, or $1.41 per diluted share, in Q2 2025. Cash Position: Approximately $855 million in cash, cash equivalents, and investments at quarter-end. Share Repurchases: Approximately 531,000 shares repurchased for about $48 million in Q2 2026. Dividend: Third-quarter cash dividend declared at $0.50 per share. Full-Year Outlook: Revenue expected to track toward the lower end of the previously communicated range of $630 million to $670 million. Warning! GuruFocus has detected 2 Warning Sign with OLED. Is OLED fairly valued? Test your thesis with our free DCF calculator. Release Date: July 30, 2026 For the complete transcript of the earnings call, please refer to the full earnings call transcript. Gen 8.6 OLED manufacturing is becoming a commercial reality with Samsung Display and BOE commencing mass production, and Visionox and TCL China Star advancing their projects. OLED adoption is expanding into new applications like automotive (e.g., Genesis GV70, Volvo EX60) and IT, with low single-digit penetration indicating significant growth runway. Phosphorescent blue technology continues to make progress, with LG showcasing a tablet prototype at SID Display Week, and the company is expanding efforts across multiple pathways. The company maintains a strong balance sheet with approximately $855 million in cash and investments, returning over $238 million to shareholders in the last 12 months. Revenue from royalty and license fees increased to $81 million in Q2 2026 from $76 million in Q2 2025, driven by cumulative catch-up adjustments. The company is investing in innovation through AI, machine learning, and strategic collaborations like the CuspAI AI Materials Foundry to accelerate materials discovery. Full-year revenue guidance was lowered to the lower end of the $630 million to $670 million range due to cautious customer demand forecasts and rising component costs pressuring smartphone volumes. Q2 2026 revenue declined to $152 million from $172 million in Q2 2025, with material sales dropping to $66 million from $89 million, impacted by lower volumes and customer mix. Near-term headwinds from rising memory costs and supply constraints are weighing on smartphone market demand expectations. The company recorded a $7 million reduction in materials gross margin due to changes in product mix and cumulative catch-up adjustments, though it expects margins to normalize in the second half. Blue development material sales have remained at low levels in the past two quarters, indicating commercialization is still dependent on customer road maps. Operating income decreased to $54 million in Q2 2026 from $69 million in Q2 2025, with operating margin falling to 35% from 40%. Q: Could there be a scenario where increased emphasis on power consumption reduction makes phosphorescent blue a more viable solution for next-generation gaming laptops or AI-related notebooks coming to market next year?A: CEO Steve Abramson stated that the more emphasis there is on power efficiency, the more important phosphorescent blue becomes. However, he declined to provide a specific timeline for commercialization, noting it depends on customer road maps. CFO Brian Millard added that LG showcased a tablet-size product with phosphorescent blue in a hybrid tandem structure at SID Display Week in both 2025 and 2026, and other customers have also developed prototypes, which is encouraging progress. Q: Even at the lower end of the guidance range, it implies a meaningful uptick in the second half of 2026. Where are you seeing the strength, and what level of confidence do you have in that outlook?A: CFO Brian Millard explained that the second half typically benefits from numerous product launches in Q3 and early Q4, and the company expects this trend to continue. Based on visibility into product cycles and customer forecasts, UDC expects second-half revenue to exceed the first half, which has been the expectation since the beginning of the year. The guidance adjustment to the lower end of the range is driven by lower volume expectations, not pricing pressure, as the company has long-term agreements with stable ASPs. Q: Is the guidance adjustment due to lower unit volume, ASP pressure, or a combination? Are you seeing any price pressure on OLED materials given rising BOM costs?A: CFO Brian Millard clarified that the change in guidance is driven by a change in volume expectations, not pricing. UDC has long-term, typically five-year deals with customers, providing consistent ASPs over those periods. The company has not seen anything out of the ordinary on the pricing side, and the lower outlook is purely a function of reduced volume expectations for the year. Q: Should we anticipate a return to more normalized material margins in the second half of 2026?A: CFO Brian Millard confirmed that the second quarter had an anomaly in materials margins due to changes in materials mix and product mix, resulting in roughly a $7 million reduction compared to Q2 2025. He expects materials gross margins to return to historical levels of approximately 60% in the remainder of the year. For total gross margins, the company maintains guidance of 74% to 76% for the full year, tracking in line at just north of 75% year-to-date. Q: Do you expect revenues to benefit in any meaningful way from new Gen 8.6 capacity in the second half, or is this more likely a catalyst for next year?A: CFO Brian Millard stated that UDC is already seeing some benefit in 2026, both in the first and second halves, as fabs prepare for mass production, and this is encompassed in current guidance. However, 2027 and beyond will see even more benefit as those fabs become fully operational at mass production scale for full 12-month periods and become more heavily utilized. 2026 is setting up the opportunity for growth in the next few years. Q: Is there any more detail on how you're progressing with commercialization of phosphorescent blue? Have reliability, yield, and lifetime improved to the point of waiting for commercial adoption, or are there still milestones to meet?A: CEO Steve Abramson noted that phosphorescent blue remains one of the company's most important opportunities, with meaningful progress made and key milestones achieved by earlier developmental materials. As the industry has evolved, multiple pathways have emerged for phosphorescent commercial blue OLEDs, and UDC is expanding efforts across a broader range of next-generation blue materials and architectures. The company is accelerating development with increased resources, including AI and machine learning, but cannot provide specific timelines as they depend on customer commercial road maps. Q: Do you expect growth in the second half across all of your customers?A: CFO Brian Millard confirmed that UDC is projecting growth across its customer base in the second half of 2026. The company expects to benefit from product cycles and is projecting broad-based growth across customers, including growth in Chinese customer revenues, despite some pressure on customers more exposed to mid- and low-end smartphone segments. Q: Do you expect incremental gross margin headwinds in 2027 based on raw material costs, and do you have potential offsets?A: CFO Brian Millard emphasized focusing on total gross margins, which is the more useful measure of profitability. For 2027, it's too early to provide guidance, but the company is focused on sourcing raw materials efficiently, particularly iridium, a key component of many products whose price has fluctuated. Offsetting factors include greater operating leverage from putting more volume through fixed manufacturing components. More color will be provided in February. Q: Blue sample material sales have stayed at a very low level in the past two quarters. What should we interpret from this, and what should we expect for the rest of the year?A: CFO Brian Millard explained that while blue development sales have been low in recent quarters, progress with customers continues to move positively. In the R&D and development cycle, a small amount of material can go a long way. The revenue number is an interesting anecdote but not necessarily the best way to measure progress toward commercialization. UDC continues to focus resources on inventing new materials to open more doors for customers in blue development. Q: Did China revenues tick up in the second quarter due to pre-buying ahead of tariffs or new production from BOE? Are we getting back to a more normalized level of China revenues?A: CFO Brian Millard noted that China sales have always been lumpy historically, and that continues to be the case. The company is projecting growth in Chinese customer revenues in the second half. Customers more exposed to mid- and low-end smartphone segments are experiencing more pressure this year, but UDC still projects growth in the second half across the board. For the complete transcript of the earnings call, please refer to the full earnings call transcript.

Our analysts just identified a stock with the potential to be the next Nvidia. Tell us how you invest and we'll show you why it's our #1 pick. Tap here. Performance was impacted by a challenging near-term consumer electronics environment, specifically rising memory costs and supply constraints weighing on smartphone demand. The company is separating current cyclical softness from long-term growth, noting that OLED area growth is expected to be flat in 2026 before resuming growth in 2027. Strategic positioning is bolstered by the commercialization of Gen 8.6 manufacturing facilities by Samsung and BOE, which target early-stage adoption markets like IT and automotive. Management highlighted that while smartphone penetration is at approximately 65%, IT, automotive, and TV markets remain in the low single digits, representing significant runway. The opening of a new technology and innovation center in Chengdu, China, reinforces the strategy of providing local support to foster collaboration with regional manufacturers. Advancements in foldable and rollable form factors, such as the Galaxy Fold 8, are expected to transition OLED from a niche category to a mainstream segment. Full-year revenue guidance was narrowed toward the lower end of the $630 million to $670 million range due to softened volume expectations in the smartphone market. Second-half revenue is expected to exceed the first half, driven by typical Q3 product launch cycles and new fab capacity moving toward mass production. The full-year ratio of material sales to royalty and license revenue is now projected to average approximately 1.2 to 1. Commercialization of phosphorescent blue remains dependent on customer roadmaps, though management is accelerating development using AI and machine learning to expand design space. Operating expenses are projected to increase by a low single-digit percentage for the full year as the company maintains a lean investment approach in R&D. Second quarter revenue of $152 million compared to $172 million in the prior year, which had benefited from elevated purchases ahead of anticipated tariffs. A $7 million negative adjustment was recorded in the materials line during Q2 due to changes in materials and product mix during the reforecasting process. Cumulative catch-up adjustments across royalty, license, and material sales totaled approximately $10 million during the first six months of 2026. Management identified iridium price fluctuations as a potential input cost variable, though they aim to offset this through manufacturing efficiencies and operating leverage. One stock. Nvidia-level potential. 30M+ investors trust Moby to find it first. Get the pick. Tap here. Management expects materials gross margins to return to historical levels of approximately 60% in the second half of the year. The Q2 margin dip was characterized as an anomaly driven by a specific $7 million reduction related to product mix reforecasting. Management declined to provide specific timelines, stating adoption is tied to customer commercial roadmaps rather than just technical milestones. They noted that while blue sample sales have been low, this is not indicative of progress as small amounts of material go a long way in the current R&D stage. Current 2026 guidance already encompasses benefits from new fabs getting ready for mass production. The full benefit of these investments is expected to materialize in 2027 and beyond as facilities reach full operational scale for a complete 12-month cycle. Management stated that ASPs remain stable due to long-term (typically 5-year) contracts with customers. The guidance adjustment was attributed entirely to lower unit volume expectations rather than pricing compression.

Universal Display Corporation OLED reported second-quarter 2026 earnings of $1.06 per share, beating the Zacks Consensus Estimate of $1.04 by 1.9%. Earnings declined 24.8% year over year. Revenues of $152.2 million fell 11.4% from the year-ago quarter and missed the consensus estimate of $158 million by 3.9%.The quarter reflected resilient royalty and license revenue despite softer material sales. Continued investment across the OLED ecosystem, including Gen 6 and Gen 8.6 capacity expansions, remained a key long-term positive even as smartphone demand and customer material volumes weakened. OLED generated total revenues of $152.2 million compared with $171.8 million in the year-ago quarter.Material sales declined 25.3% year over year to $66.2 million, primarily due to lower unit material volume, changes in customer mix and an unfavorable cumulative catch-up adjustment. Royalty and license fees increased 7.3% to $81.2 million, supported by favorable cumulative catch-up adjustments. Contract research services revenue decreased to $4.8 million from $7.5 million a year ago. Universal Display Corporation price-consensus-eps-surprise-chart | Universal Display Corporation Quote Net income declined 26.5% year over year to $49.4 million, or $1.06 per diluted share, from $67.3 million, or $1.41 per diluted share, in the second quarter of 2025.The decline reflected lower operating income resulting from weaker material sales and a softer customer mix, partially offset by higher royalty and license revenue. The company reported an effective tax rate of 19% compared with 19.8% in the year-ago quarter. Total gross margin slipped to 76% from 77% in the prior-year quarter.Operating expenses, excluding cost of sales, declined modestly to $61.7 million from $64.1 million a year ago as the company maintained disciplined spending while continuing to invest in research and development and growth initiatives. Operating income declined to $53.6 million from $68.5 million, with operating margin narrowing to 35% from 40%. Management emphasized that long-term industry fundamentals remain intact despite near-term demand softness caused by rising memory costs and pressure on smartphone volumes.Universal Display highlighted ongoing investments in next-generation OLED manufacturing, including new Gen 8.6 production lines at Samsung Display and BOE, alongside expansion projects at Visionox and TCL China Star. The company also continued advancing phosphorescent blue technology, tandem architectures and artificial intelligence-driven materials discovery while opening a new OLED Technology and Innovation Center in Chengdu, China. Management now expects 2026 revenues to trend toward the lower end of its previously announced guidance range of $630-$670 million.The revised outlook reflects more cautious customer demand forecasts across portions of the consumer electronics supply chain. Even so, the company expects second-half revenues to exceed first-half levels, supported by seasonal product launches, new production capacity and broader OLED adoption across IT, automotive and emerging form factors. Universal Display continued to generate solid cash flow and ended the quarter with approximately $855 million in cash, cash equivalents and investments, providing substantial financial flexibility.During the second quarter, the company repurchased approximately 531,000 shares for $48.2 million. Over the past 12 months, it returned more than $238 million to shareholders through dividends and share repurchases. The board also declared a third-quarter cash dividend of 50 cents per share. Management believes the industry's next growth phase is taking shape as OLED penetration expands beyond smartphones into IT devices, automotive displays and new form factors such as foldable and rollable products.The company expects investments in manufacturing capacity, continued innovation in OLED materials and commercialization of next-generation technologies to support long-term growth. While near-term demand remains constrained by macroeconomic and component cost pressures, management expects customer activity and revenue to improve during the second half of 2026. OLED currently carries a Zacks Rank #4 (Sell). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here. Arista Networks Inc. ANET is scheduled to release second-quarter 2026 earnings on Aug. 4. The Zacks Consensus Estimate for earnings is pegged at 89 cents per share, suggesting growth of 21.9% from the year-ago reported figure.Arista has a long-term earnings growth expectation of 19.9%. Arista delivered an average earnings surprise of 8.3% in the last four reported quarters.Akamai Technologies, Inc. AKAM is slated to release second-quarter 2026 earnings on Aug. 6. The Zacks Consensus Estimate for earnings is pegged at $1.58 per share, indicating an 8.7% decline from the year-ago reported figure.Akamai has a long-term earnings growth expectation of 8.1%. Akamai delivered an average earnings surprise of 7.5% in the last four reported quarters.Pinterest, Inc. PINS is set to release second-quarter 2026 earnings on Aug. 4. The Zacks Consensus Estimate for earnings is pegged at 36 cents per share, implying a rise of 9.1% from the year-ago reported figure.Pinterest has a long-term earnings growth expectation of 27%. Pinterest delivered an average negative earnings surprise of 4.1% in the last four reported quarters. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Universal Display Corporation (OLED) : Free Stock Analysis Report Akamai Technologies, Inc. (AKAM) : Free Stock Analysis Report Arista Networks, Inc. (ANET) : Free Stock Analysis Report Pinterest, Inc. (PINS) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

Universal Display Corp. (OLED) came out with quarterly earnings of $1.06 per share, beating the Zacks Consensus Estimate of $1.04 per share. This compares to earnings of $1.41 per share a year ago. These figures are adjusted for non-recurring items. This quarterly report represents an earnings surprise of +1.92%. A quarter ago, it was expected that this organic light-emitting diode technology company would post earnings of $1.13 per share when it actually produced earnings of $0.76, delivering a surprise of -32.74%. Over the last four quarters, the company has surpassed consensus EPS estimates two times. Universal Display, which belongs to the Zacks Electronics - Miscellaneous Components industry, posted revenues of $152.16 million for the quarter ended June 2026, missing the Zacks Consensus Estimate by 3.93%. This compares to year-ago revenues of $171.79 million. The company has not been able to beat consensus revenue estimates over the last four quarters. The sustainability of the stock's immediate price movement based on the recently-released numbers and future earnings expectations will mostly depend on management's commentary on the earnings call. Universal Display shares have lost about 31.4% since the beginning of the year versus the S&P 500's gain of 6.9%. While Universal Display has underperformed the market so far this year, the question that comes to investors' minds is: what's next for the stock? There are no easy answers to this key question, but one reliable measure that can help investors address this is the company's earnings outlook. Not only does this include current consensus earnings expectations for the coming quarter(s), but also how these expectations have changed lately. Empirical research shows a strong correlation between near-term stock movements and trends in earnings estimate revisions. Investors can track such revisions by themselves or rely on a tried-and-tested rating tool like the Zacks Rank, which has an impressive track record of harnessing the power of earnings estimate revisions. Ahead of this earnings release, the estimate revisions trend for Universal Display was unfavorable. While the magnitude and direction of estimate revisions could change following the company's just-released earnings report, the current status translates into a Zacks Rank #4 (Sell) for the stock. So, the shares are expected to underperform the market in the near future. You can see the complete list of today's Zacks #1 Rank (Strong Buy) stocks here. It will be interesting to see how estimates for the coming quarters and the current fiscal year change in the days ahead. The current consensus EPS estimate is $1.11 on $162.84 million in revenues for the coming quarter and $4.23 on $643.54 million in revenues for the current fiscal year. Investors should be mindful of the fact that the outlook for the industry can have a material impact on the performance of the stock as well. In terms of the Zacks Industry Rank, Electronics - Miscellaneous Components is currently in the top 26% of the 250 plus Zacks industries. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1. One other stock from the same industry, Novanta (NOVT), is yet to report results for the quarter ended June 2026. The results are expected to be released on August 5. This photonic and motion control components maker is expected to post quarterly earnings of $0.83 per share in its upcoming report, which represents a year-over-year change of +9.2%. The consensus EPS estimate for the quarter has remained unchanged over the last 30 days. Novanta's revenues are expected to be $261.53 million, up 8.5% from the year-ago quarter. Want the latest recommendations from Zacks Investment Research? Today, you can download 7 Best Stocks for the Next 30 Days. Click to get this free report Universal Display Corporation (OLED) : Free Stock Analysis Report Novanta Inc. (NOVT) : Free Stock Analysis Report This article originally published on Zacks Investment Research (zacks.com). Zacks Investment Research

EWING, N.J., July 30, 2026--(BUSINESS WIRE)--Universal Display Corporation (Nasdaq: OLED), a global leader in energy-efficient OLED technologies and materials, announced today that its Board of Directors approved a third quarter cash dividend of $0.50 per share on the Company's common stock. The dividend is payable on September 30, 2026, to shareholders of record on September 16, 2026. The dividend reflects our expected continued cash flow generation, and commitment to return capital to our shareholders. Future dividends will be subject to Board approval. 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 7,000 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 and future declaration of dividends, 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, 2025. Universal Display Corporation disclaims any obligation to update any forward-looking statement contained in this document. Follow Universal Display Corporation X LinkedIn Facebook YouTube (OLED-C) View source version on businesswire.com: https://www.businesswire.com/news/home/20260730449449/en/ Contacts Universal Display Contact: Darice [email protected] [email protected] +1 609-964-5123