Universal Display Corporation

Good day, ladies and gentlemen, and welcome to Universal Display Corporation's first quarter 2026 earnings conference call. My name is Sherry, and I will be your conference moderator for today's call. If anyone should require operator assistance during the conference, please press star zero on your telephone keypad. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Darius Liu, Senior Director of Investor Relations. Please proceed.

Thank you and good afternoon, everyone. Welcome to Universal Display's first quarter earnings conference call. Joining me on the call today are Steve Abramson, President and Chief Executive Officer, and Brian Millard, Chief Financial Officer and Treasurer. Before Steve begins, let me remind you that 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 express 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, April 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 Steve Abramson.

Thanks, Daris, and good afternoon, everyone. Thank you for joining us today and for your continued interest in Universal Display. Let me begin with how we are thinking about the business. both in the context of today's environment and the longer-term opportunity we continue to see ahead. While the near-term backdrop has become more challenging, our long-term view remains unchanged. Our leadership at OLED, built on sustained innovation and deep customer integration, positions us well to navigate the near-term macro uncertainty while continuing to capture the industry's long-term growth opportunities. We operate a high-margin business model with strong free cash flow generation, longstanding partnerships across the OLED ecosystem, and a balance sheet that provides meaningful strategic and financial flexibility. At the same time, visibility across the consumer electronics value chain has become more limited in recent months. A more cautious demand environment, higher component costs, and supply constraints are adding complexity to demand forecasting. These dynamics are consistent with what we are hearing broadly across the industry and reflected in newly published conservative outlooks from third-party market research firms. Against this backdrop of increased uncertainty, we believe it is prudent to moderate our near-term revenue expectations. Brian will provide additional details shortly. Despite these near-term dynamics, our profitability, cash flow generation, and lean operating model remain strong. We ended the quarter with approximately $911 million in cash and investments, supporting a measured and balanced capital allocation approach centered on investing in innovation, pursuing strategic opportunities, and returning capital to shareholders. Over the last 12 months, we returned more than $187 million to shareholders through dividends and share repurchases. We announced today the authorization of a new $400 million share repurchase program following the full utilization of our prior $100 million authorization. While we remain disciplined in our approach, this authorization underscores our confidence in the long-term trajectory of the business and the strength of our task generation model. Looking beyond the near term, the growth runway for OLEDs remains as compelling as ever. Adoption is expanding across IT, automotive, televisions, and foldables, and emerging architecture such as tandem. At the same time, performance expectations continue to rise across key dimensions, including brightness, power efficiency, lifetime, and color performance. As these requirements increase, materials and technology innovation becomes even more critical, reinforcing the value of our capabilities and our role in enabling progress across the OLED ecosystem. Phosphorescent blue continues to be a significant opportunity for the industry and a key area of focus for us. As specifications advance and new architectures emerge, expectations for blue are becoming more demanding and more varied across applications. In turn, we are aligning our blue development program to meet these increasingly complex specifications. While this evolution is extending the development path, our conviction in the commercialization of phosphorescent blue has not wavered. The value proposition is clear. When adopted, we believe phosphorescent blue has a potential to deliver up to an initial 25% improvement in OLED panel energy efficiency, a meaningful advance at a time when devices are being asked to do more, run longer, and perform better. That is a compelling proposition for the industry, and the market interest reflects it. We look forward to sharing additional technical detail next week during our invited paper presentation at SID Display Week. Supporting this work is an increasingly powerful in-house R&D engine. We are applying AI and machine learning at greater scale to enhance material discovery, evaluate candidates more effectively, and prioritize development pathways. For example, these tools allow us to predict thermal processing stability up to 10,000 times faster than traditional density functional theory while achieving near comparable accuracy. By combining AI-driven modeling with more than 20 years of proprietary data, deep device expertise, and decades of OLED know-how, we are accelerating progress in phosphorescent blue while also advancing innovation across our next-generation red, green, and yellow emissive materials. More broadly, earlier this month at ICDT, China's largest display technical symposium, we highlighted a meaningful shift underway in the industry. As performance requirements continue to broaden, progress increasingly depends on advancing materials, device architecture, and display design together with a greater emphasis on energy efficiency. The system-level approach is supporting the development of advanced OLED architectures such as tandem and hybrid structures, advanced pixel layouts, and PSF, helping address the evolving performance demands across applications. This direction aligns well with our longstanding development philosophy and reinforces our role in enabling innovative OLED solutions as the industry evolves and grows. One example we shared in the invited paper was the incorporation of our phosphorescent material into the industry's first commercial green PSF product targeting BT 2020 specifications introduced by Vigilante. This milestone highlights the growing role of our phosphorescent materials in enabling next-generation OLED architectures and reinforces our position at the forefront of OLED innovation. The same depth of collaboration extends across our broader customer base. During the first quarter, we announced new long-term agreements with TNMA and LG Display. These agreements underscore the value we deliver and the trust we have built over multiple technology cycles. At the industry level, we believe OLED is entering the early stages of a multi-year capacity expansion cycle. Significant new Gen 8.6 investments are progressing in Korea and China to support growing adoption across IT and automotive applications. Samsung Display's $3.1 billion facility is reportedly nearing commercial shipments, and BOE's $9 billion fab has entered customer sample validation and is targeting mass production in the second half of this year. VisionOx has begun equipment move-in at its $7.6 billion facility, and TCL China Star continues construction on its $4.1 billion Greenfield plant. We view this year as the beginning of a longer ramp, with output increasing over time as facilities move through qualification, yield ramp, and production scaling. Taking together these developments across technology roadmaps, customer engagement, and manufacturing capacity reinforce our conviction in OLED's long-term growth trajectory, and in the increasingly important role we play in enabling next-generation architectures that advance performance. With our materials leadership, deep customer partnerships, strong financial foundation, and disciplined capital allocation, we believe we are uniquely positioned to drive sustainable long-term value creation. And with that, I'll turn the call over to Brian.