A display brand is going through a difficult transformation amid industry changes

A Taiwanese company, a veteran in the display industry, is currently undergoing a challenging transformation, facing the dilemma of declining revenue and increasing losses. The company's latest annual financial report shows that 2024 will be a difficult year, with annual revenue falling below NT$10 billion and losses widening to NT$5.325 billion, the third consecutive year of losses. The fourth quarter was particularly difficult, with losses exceeding NT$1.5 billion in a single quarter, coupled with NT$188 million in impairment charges for inefficient equipment assets.

Industry Challenges and Strategic Shifts

The global display panel industry has been facing headwinds due to oversupply, fierce competition and changing demand dynamics. Traditional consumer electronics, which used to be the mainstay of xx Display's business, have been declining in profitability as the market saturated and price pressure intensified. To this end, xx Display has been actively restructuring its product portfolio to reduce its reliance on consumer electronics, which currently account for less than 45% of its revenue.

Instead, the company is turning to higher-margin areas, especially automotive and industrial panels. xx Display's automotive panel business has become a major growth driver, currently accounting for 25% of its revenue. The company aims to increase this share to 35% by 2025, focusing on advanced applications such as head-up displays (HUDs) and electronic rearview mirrors. New projects in this area are expected to gain traction from the fourth quarter of 2025, with a larger contribution expected in 2026.

Entering industrial and niche markets

In addition to automotive panels, xx Display is also strengthening its presence in the industrial panel market, which currently accounts for about 25% of its revenue. The company is targeting applications such as aviation, maritime, smart home devices, rugged tablets and laptops. While competition in the large central control panel space has led to lower shipments, xx Display sees long-term potential in professional industrial applications.

The company is also exploring products such as environmentally friendly display paper, although the field is still in its early stages. After overcoming initial yield issues, xx Display plans to launch tablet and monitor products using the technology in 2025. However, due to its professional applications, this field is expected to contribute only about 2% of revenue in the short term.

Global Expansion and Staff Restructuring

XX is eyeing growth opportunities in emerging markets, particularly India, where it is targeting the motorcycle instrument panel segment. While the contribution from this market is currently modest, the company expects gradual growth from the fourth quarter of 2025, with more significant growth in 2026

Future Outlook

Despite the current challenges, XX remains optimistic about its long-term prospects. The company believes its focus on automotive and industrial panels will pay off, with the next wave of growth expected in late 2025 to 2026. As the automotive industry increasingly adopts advanced display technology to manufacture HUDs, electronic rearview mirrors, and multi-function screens, XX is well positioned to capitalize on this trend.

The broader display panel industry is also expected to stabilize as demand for specialized applications grows. Companies like this one that successfully transition from traditional consumer electronics to high-value segments are likely to emerge stronger in the coming years.