LG Display Co., Ltd.

Good morning and good evening. First of all, thank you all for joining this conference call, and now we will begin the conference on the Fiscal Year 2023 First Quarter Earnings Results by LG Display. This conference will start with a presentation, followed by a different Q&A session. If you have a question, please prep start one, that is, start any one on your phone during the Q&A. Now we shall commence the presentation on the Fiscal Year 2023 First Quarter Earnings Results by LG Display.

Hello, I'm Heo Seok, CEO of LG Display IRC. I'd like to thank everyone who participated in this quarter's performance announcement conference call. In today's conference call, CFO Kim Sang Hyun, CSO Kim Hee Hyun, Business Management Manager Lim Seung Min, Auto Marketing Manager Song Ki Han, Business Intelligence Manager Lee Ki Young, Big Marketing Manager Lee Won Jae, and Middle Marketing Manager Kim Chang Won participated.

Good afternoon. This is Brian Hall in charge of IR at LG Display. On behalf of the company, I would like to thank all the participants for joining this conference call. Today, I am joined by the CFO, Sung Hyun Kim, CSO, Hyun Kim, Senior Vice President of Corporate Planning, Seung Min Lim, Vice President of Auto Marketing, Ki Hwan Son, and Ki Young Lee in charge of Business Intelligence, Won Jae Lee in charge of Large Display Marketing, and Cha Won Kim in charge of Medium Display Marketing.

The conference call will be conducted in both Korean and English.

Please refer to the provisional earnings released today or the IR events section of the company's website for more details on the financial results of Q1 2023.

Also, before we begin the presentation, please take a moment to read the disclaimer.

Please also note that today's results are based on consolidated IFRS standards prepared for your benefit and have not yet been audited by an outside auditor.

TV and IT products are mainly used for TV and IT products. TV and IT products are mainly used for TV and IT products. TV and IT products are mainly used for TV and IT products. TV and IT products are mainly used for TV and IT products. TV and IT products are mainly used for TV and IT products. I will first start with Q1 business results.

In the midst of sluggish demand for TV and IT products and inventory corrections continuing in the downstream industries, there were added impact from slow seasonality and the company's downsizing of its LCD TV business which all drove Q1 revenue down 40% Q1Q and 32% year-over-year, reporting 4,411,000,000,000 won.

On the other hand, since the 4th quarter, the growth has been relatively reduced, and the loss of sales of 1,980,000,000 won has been recorded due to the continuous implementation of high-intensity cost reduction activities such as large-scale operations.

Meanwhile, underpinned by preemptive inventory downsizing since Q4, we continued to rationalize large panel business, undertook intense cost savings, introducing cost innovations, thanks to which we were able to narrow the fluctuations in profit and reported operating loss of 1 trillion 98 billion won.

다음은 출하 및 면적당 판가추입니다. 1분기 출하 면적은 전방수요 부진 및 계절적 비수기 진입에 따른 last year's end of the year, the production of domestic lcdtv fab was reduced by 46% compared to the previous quarter due to the reduction of the lcdtv business, which recorded 4.24 million square meters. Usually, the price per area per quarter of the first quarter falls due to the seasonal influence that the demand for mobile products decreases, but this quarter, the price per area per quarter of the lcdtv product group, which is the lowest, Next on area shipment and ASP per square meter.

First quarter area shipment was down 46% Q&Q reporting 4.24 million square meters on the back of muted downstream demand and seasonal shipment declines across all product segments as well as downsizing of the company's LCD TV business with the closure of domestic LCD TV fab end of last year. Typically, ASP per square meter follows a downward trajectory during the first quarter, as mobile demand seasonally declines during this period. But this quarter, on a lower LCD TV mix, whose ASP is the lowest, ASP per square meter actually increased 20% Q&Q, reporting $850.

Next, I'd like to talk about product sales. LCD TV downsizing recorded a 19% decline of 6% compared to the previous quarter, and the IT sector recorded a 38% increase. The mobile and other sectors recorded a 32% decline of 2% compared to the previous quarter due to a decrease in the number of panels due to seasonal factors. The auto business sector recorded a stable growth rate, Thank you for watching.

In terms of the revenue breakdown by each product segment, on the back of downsizing of the LCD TV business, revenue mix of the TV panel was down 6 percentage points Q on Q, reporting 19%, while IT panel mix reported a relative increase, recording 38%. Driven by seasonality and ensuing decline in panel shipment, mobile and other products saw their revenue mix dip by 2 percentage points Q over Q to 32%. Auto business continued to show steady top-line growth, reporting mid-20% revenue growth year-over-year, with its revenue mix at 11% this quarter. OLED revenue mix was lower Q&Q due to seasonal declines for large and mobile OLEDs, but on a year-over-year basis, driven by sustained efforts towards business structure upgrades, OLED revenue mix was up 13 percentage points, reporting 45%.

Next is on the financial position and key metrics.

Companies cash and cash equivalent was 3 trillion 894 billion won maintaining above the mid $3 trillion level. While on the back of active inventory management to keep it at the minimum level, Q1 inventory was flat Q over Q at $2,811,000,000.

Key financial ratios were up Q and Q on rise in debt,

with debt-to-equity ratio of 248% and net debt-to-equity ratio at 126%.

In terms of cash flow, opening cash balance was 3,547,000,000 won, And with increase in cash inflow from financial activities, there was an increase of 347 billion won Q over Q, reporting ending balance of 3,894,000,000,000 won. Next on Q2 guidance, although market volatilities and uncertainties persist,

We expect pickup in seasonal demand following the launch of new models from each product segment in the second quarter, driving queue-over-queue shipment growth for large and mid-sized panels. As such, area shipment is expected to rise by around 10% queue-on-queue. On seasonal declines in mobile panel shipment, ASP per square meter is expected to fall mid-single-digit on a queue-over-queue basis.

Next, we will look at the key highlights of the corporate sales management information. 이어서 당사 CFO 김성현 전무의 키 하이라이트가 있겠습니다.

Next, our CFO 성현김 will walk through key highlights.

안녕하십니까? CFO 김성현입니다.

Good afternoon. This is CFO 성현김.

지난 1분기를 돌아보면 계절적 비수기 영향 외에도 지난해부터 이어져온 As a result of the decline in economic uncertainty and inflation, the supply and demand of display panels and the entire industry continued to be difficult to control. In particular, the supply and demand of high-end products is greater than that of conventional products that have previously been affected, and as the LCD TV business was reduced due to the implementation of its own business structure and strategy, the output and sales decreased significantly compared to the previous year.

Looking back over the first quarter, difficult market backdrop continued as last year's macro uncertainties persisted while inflation squeezed down on consumption, which drove muted demand for display panels with inventory corrections continuing in the downstream industries. In particular, sluggish demand for high-end products was more pronounced versus what was seen previously for general B2C products. And as the company downsized its LCD TV business as part of the strategy to advance its business structure, Shipment and revenue declined by somewhat of a large margin compared to previous years.

To respond to such business environment, the company has engaged in preemptive inventory cuts Rationalized operation of large panel business and actively and intensely reduced and innovated our cost base in order to narrow the extent of fluctuation in profit.

Under continuing slump of the downstream industry, market dynamic has been such that panel shipment has been weaker below actual set sales for around one full year now, making it difficult to predict the exact timing of recovery or normalization of sell-through demand. Accordingly, the company is focusing on recovery of its financial soundness and upgrading to advanced business structure in order to pull forward its execution capabilities.

First of all, in order to strengthen the mobility, the company has conducted strategic capital extraction from LG Electronics in the first quarter. The company is expecting to expand its business cooperation as well as strengthen the stability of the financial management in an uncertain environment due to the fundamental. The funded funds will be used to maintain financial strength OLED 사업 경쟁력 강화를 위한 제품 및 기술 개발, 투명 게이밍과 같은 시장 창출형 사업 추진 등 사업 구조 고도를 위한 재원으로 활용할 계획입니다.

First, to strengthen our liquidity position in Q1, we entered into a strategic financing arrangement with LGE. Through this arrangement, we were able to expand business cooperation while at the same time strengthen stability in operating our funds, in the face of uncertain external environment. The funds raised will be used to bolster financial strength, develop products and technologies to strengthen our OLED business, and to further advance companies' business structure, such as through driving market-creating businesses, including transparent and gaming OLED applications.

In addition, in the first half of the year, we will continue to develop a variety of options Also throughout the first half we plan to tap into multiple financing options to further strengthen our liquidity position

and build up an agile financial structure to flexibly respond to challenging environment. This will push up some of our financial ratios, but after the start of the second half, on gradual earnings improvement, we will enhance financial metrics in stages.

In terms of the structure of the business, it is a business that can effectively manage water and price through close cooperation with customers.

In terms of upgrading the business structure by growing the contribution from order-based business where volume and price can be managed favorably based upon close collaboration with our customers, we plan to focus our capabilities on future proofing and bolstering competitiveness towards differentiation.

The net sales of the water-based business has increased by 40% this year, and it is aiming to reach 70% within the next 2-3 years. While the mobile product export volume is expected to increase this year, it will further strengthen the world's number one position through water-based and sales growth through vehicle display and tablet PC OLEDs, which are being invested in, This is a plan to prepare the production and supply system for 2024 based on technology leadership.

Share of order-based business increased to early 40% this year, and our target is to reach 70% in two to three years' time. High-value-added mobile products slated for additional mass production this year will see increase in shipment, while we will solidify global number one positioning by securing orders and growing revenue from displays for automobile applications. For the mid-size OLED, including OLED for tablet PCs, where investment is currently ongoing, we plan to thoroughly prepare for supply and mass production in 2024, underpinned by technology leadership.

In the case of a supply and mass production business with a large impact on market volatility, We'll be right back. We'll be right back. We'll be right back. For the supply and demand-based business, where market volatilities are high, we are focusing on high-value-add segments.

For large OLEDs, we are broadening the lineup of differentiated products underpinned by stronger fundamental competitiveness in i.e. brightness and power consumption, And through cost innovations, we plan to solidify our premium TV market positioning and accelerate market-creating businesses, which include transparent and gaming OLED applications. For the order-based business, where volume and price are more favorable as we can engage in close collaboration with customers, we will continue to grow its share and focus our capabilities on future-proofing and bolstering our competitive edge.

The situation is still unstable and changeable, and the supply and demand of the entire industry is continuing to adjust, but we expect that the 2nd quarter profit will be slightly improved compared to the 1st quarter with high cost reduction efforts. From the second half of the year to the end of the year, the supply and demand of the entire industrial ecosystem will increase due to the recovery of the supply and demand of the industrial ecosystem,

market uncertainties and volatility still run high and although demand is muted and inventory adjustment continues in the downstream driven by intense cost saving efforts we expect q2 profit to marginally improve versus the first quarter As we bottom out in the first half, following recovery of inventory levels and soundness thereof across the overall ecosystem of the industry, in the second half of the year, we will see rise in demand for panels, and with increase in shipment for mobile products and positive performance from the order-based businesses, we plan to achieve a turnaround in profit in the second half of the year and drive earnings improvement on a full-year basis.

Notwithstanding unprecedented weakness in the market, by advancing the business structure that will form the basis for steady earnings going forward and stronger financial soundness,

We commit to do our utmost to overcome this difficult situation with speed and drive meaningful results. Thank you.

This brings us to the end of the earnings presentation for Q1 2023.

We will now go into questions. Operator, please commence with the Q&A session.

Now Q&A session will begin. Please press star 1, that is star and 1 if you have any questions. Questions will be taken according to the order you have pressed to start at number 1. For cancellation, please press star 2. That is star N2 on your phone. In order to allow as many Q&A chances as possible within the restricted time, we would appreciate only two questions per participant. The first question will be presented by Dongwon Kim from KB Securities. Please go ahead with your question.

Yes, thank you for the question. I will ask questions about large and medium-sized enterprises. First, I'm curious about the progress of the Guangzhou and Paju LCD lines. Please also tell us about the road map of the future LCD TV exit strategy. And I'm curious about the possibility of the new customers of the large OLED part mentioned in recent media reports. Next year, I would like to ask if you can expect a positive improvement in the white OLED business. Next, in the case of medium-sized P-LEDs, Last year, due to production issues, the profitability was not good, and the volume also ended at the level of 40 million. In the second half of this year, what level of volume are you expecting to increase compared to last year, and do you expect a significant profitability improvement? Lastly, in the case of the strategic customer tablet OLED next year, when comparing it with competitors, what level of supply position do you expect our company to be? Thank you for taking my question.

I have several questions relating to your large panel business as well as related to your mid to small size panel business. First, can you provide some color as to how things are going with regards to your plan to sell off your plants and fabs in Gwangju and Paju? If you can also provide a little more color on the entire LCD TV FAB exit roadmap, that will also be quite helpful. And according to the press coverage, we'd like to understand what your assessment is with regards to the likelihood of your success vis-a-vis the large panel OLED and acquiring of new customers compared to your past endeavors. And also, would that mean that we can expect to see some improvement on your profitability on your white OLED business going forward? And second question relates to your P-OLED business. Your profitability has not been all that great, and also the amount of sold volume was quite low, below about 40 million. We'd like to understand whether you see that going forward as we enter into the second half of the year, we will see improvement in profitability in a meaningful manner, as well as improvement in volumes. Another question relates to your tablet OLED business for next year. What is your assessment as to your positioning on your key customers vis-a-vis your competitors? And can we look forward to profitability improvement from this business as well?

Yes, I will first tell you about the direction of the LCD factory.

Yes, I will respond to the first question on our LCD exit planning.

As you are already aware, we closed down our domestic LCD fab end of last year, and we are currently running our China 8th generation fab

At about 50%, we have downsized the running of that China fab. Now, with regards to the LCD TV fab, we are looking at various different aspects to come up with ways to meaningfully utilize the LCD TV fab

And at this point, we are carrying out with initiative to sell off our domestic Gen 7 TV fab.

And with regards to other FAFSAs, we are at this point tapping into various different options that could help us maximize the profit of the company by looking at potentially transitioning it or migrating it for a different use case or through selling it off or maybe engaging in strategic partnerships.

I'm Lee Won-jae, CEO of Daehong Strategy Marketing. First of all, I would like to ask for your understanding that it is difficult to directly mention the customer-related situation.

Hello, I am Wanjae Lee in charge of large display marketing. Before I provide you with an answer, I hope that you could appreciate and understand that it will be difficult for us to provide you with any specific information that relates to our customers.

JASA is trying to improve customer structure, The possibility is always open. If we can recognize the value of OLED and create a synergy, we will actively cooperate with any customers. In terms of strengthening the future business portfolio, we are expanding the line-up of continuous customers and transparent businesses using OLED advantages.

The company, as we speak, is really endeavoring to bring improvements with regards to our overall customer relationship and the overall dynamics of the structure. We will very actively engage in collaborations with any customer who we deem we could create mutual synergies and who really appreciate and understand the value of OLED. At the same time, we are at this point continuously strengthening Our other businesses, including gaming and transparent OLED applications, that fully utilizes the strength of the OLED technology so that we may further bolster our business portfolio in the future.

Recently, the market has been prolonged due to macro variability, and the demand for high-end TV markets, including OLED TV, has been increasing

Now, if you look at the recent macro environment, the volatilities are running high and we have seen market really significantly dampen. And if you look at the sluggishness in the market demand, What we experience in the high-end market, including the OLED TV, is much weaker compared to what we previously explained in our general purpose B2C products.

Due to the impact of the pipeline adjustment of the 1st quarter OLED panel, we are regretting the failure of the 1st quarter OLED panel compared to the actual sale of the set, but we are also Under this backdrop, we have seen during the first quarter in terms of the OLED panel shipment,

really perform weaker compared to the actual set sales or sell-through due to the fact that there has been the inventory adjustment in our set customers as well as from the channel, as well as influenced by this low seasonality. On the other hand, from our major customer, LGE, we have seen through preemptive inventory adjustment as well as cost efficiency efforts, We have seen significant improvements in terms of our performance for the Q1, and going into Q2, we expect to see a gradual improvement in terms of the volume as well as in terms of our market positioning.

As a result, the market expectations for the big OLEDs this year and next year are still favorable. Although it is a difficult environment, based on OLED competitiveness,

So based off of this assessment, our expectations, our positive expectations going forward for the large OLED market still stands. It is still valid. And despite the difficult situation, by utilizing and leveraging our competitive edge that we have in the OLED business, We will continue to strengthen our positioning in the high-end TV market.

This is the CSO.

I will respond to your question about the volume growth for smartphones.

If you look at our company's smartphone capacity, based on Generation 6, our capacity is 30K, and this year we will be adding 1.15K more.

And we expect to see that our volume growth will be aligned with such capacity additions.

Hello, I am Changwon Kim in charge of medium display marketing. I will respond to your question about tablet OLED.

As we start to enter into the OLED tablet segment in the first half of year 2024, we are expecting to have a share of about 50% in our strategic customer in the OLED tablet segment and

In terms of the overall OLED tablet market, we are seeking to have more than 60% positioning.

Now, as we enter into this tablet OLED business, we are looking forward to two areas of improvement in terms of profitability and narrowing the volatilities of earnings performance.

First, due to the double-level panel price difference compared to the existing LCD, we expect overall sales to expand. Second, compared to smartphones,

Because the panel price is two times higher compared to the LCD price, we are looking forward to higher levels of revenue growth. And also, secondly, compared to smartphones, tablets have a much lesser seasonal volatility across the first half and the second half of the year. Hence, we believe or we hope to see a reduced extent of volatility experienced in the first half of the year.

We will take the next question, please. Your next question will be presented by Jeonghun Jang from Samsung Securities. Please go ahead with your question.

Yes, thank you for the question. I'm Jeonghun Jang from Samsung Securities. As the CFO highlighted, it is expected to increase the net profit margin by 40% this year. The goal is to expand 70% in 2-3 years. If the water-based industry is targeting auto display in our business, auto display accounts for 11% of the total sales of Japanese devices. Can we see 40% expansion in a year? If we can see it, I'm curious about the driver of that change. Secondly, in order to expand the supply chain of the Autodesk Pi, I think customers would like to check the CAPA of the supply line. In that case, please explain in detail what kind of preparation you are preparing for the preparation or use of the CAPA.

Thank you for taking my question. I'm from Samsung Securities. During the presentation, CFO mentioned that you are looking to increase the revenue mix from the order-based business from 40% to above 70% going forward into the future. I would like to ask for more color with regards to this is that in the first half of the year, I see that your auto application business accounts for 11% of the total mix. then can we expect to see this increase to 40% at the end of the year, and what would be the key driver that will enable that? And also, if you are seeking to expand your auto display business and also expand your order-based business, I would assume that your customers would want to have, would want to confirm the level of capacity that you can provide them, would like to hence understand what your business management plans are with regards to capacity management.

Yes, hi, this is Hyun Kim.

I am the CSO. I will respond to your question.

We are not only talking about auto business. Although it is still useful in the past, the supply of the display industry is based on market competitiveness. We are talking about the supply industry, which had a lot of fluctuations due to the market situation.

When we say order-based business, we are not just referring to the auto business. The concept of order-based business is, I guess, is opposite to what we are used to in the display industry, whereby the display industry has usually been based off of supply and demand dynamics. Based upon the growth of the market, what the companies usually did was build out capacity, add capacity before the actual orders come in. And there has been significant market fluctuation that hence the companies were exposed to. So the order-based business is a concept that is, you know, in opposite to this demand and supply-based dynamic.

Yes, in that respect, the consumer business is

Now, in that sense, the order-based businesses, basically under this mechanism, the volume of the business is managed based upon the agreement or contract as well as communications with the customers.

So it provides one with a clearer visibility and stability as compared to the demand and supply-based business.

Now, so based upon that definition, this order-based business will include tablet, mobile phone, watch, and auto applications. And auto, as you've correctly mentioned, its mix will be around 10%, whereas everything else will account for around 30%.

So auto business, in terms of its order backlog and business visibility, it is very high and quite clear.

And with regards to how the auto business will play out going forward, I will turn it over to Mr. Son from auto marketing to respond to that question. Yes, I am Ki-Hwan Son from Auto Marketing.

Now responding first to the overall growth trend in terms of the top-line revenue and order backlog for auto business, allow me to speak on that first. Now, auto business, as of the first quarter, we actually reported above $3 trillion in the orders booked.

And on a YTD basis, in terms of the order backlog, this is a 20% growth. And compared to end of 2021, a 70% growth. For the auto business, the revenue for year 2023, in three years' time, we expect to see about a two-fold growth going forward, going above the $2 trillion. In three years' time. Within three years' time, excuse me.

Next question, please.

The next question will be presented by Won Seok Jung from High Investment and Securities.

Please go ahead with your question. Thank you. I think we need to improve our performance. From the perspective of an investor, you mentioned the black-and-white transition in the second half of the year. Should we just wait for the demand to rise? Or even if the demand doesn't improve at this level, even if the demand recovery is delayed next year, should we make additional efforts to reduce the cost Yes, with regards to your long-term horizon approach, you talked about the auto display.

At the end of last year, you started to reduce and phase out your LCD TV capacity. And the fact that the panel prices started to pick up in Q1, of course, didn't really influence your earnings that much because of your downsizing of the LCD TV business. It seems your significantly loss-making businesses are OLED TV and your IT business. And with regards to improving the earnings, that seems to be quite necessary at this point. And from the investor's perspective, and as you mentioned during the presentation, you're looking forward to a turnaround in profit in the second half of the year. But would that mean that we would just have to wait for an improvement in the overall market demand? Or even if the demand recovery is delayed and pushed back to next year, can we still expect a profit turnaround driven by your cost savings efforts or maybe potentially a human restructuring of your headcount?

Thank you very much for that good question. I will respond as a CSO to your question.

Now, in such a large-scale equipment-based industry, such as that of a display industry, when there are three factors that are all coming into play, including macro uncertainties, adjustment of the inventory, as well as a muted sell-through demand, I have to admit it is extremely difficult and not easy to predict an earnings improvement going forward. Now we are, however, looking forward to a turnaround next year and turning around into profit, driven by one driver, which is industry-based, and three very corporate-specific drivers.

We also believe that the demand for real sales will be difficult to recover due to several macro factors. However, due to these factors, the effort to control the entire industry has been going on for nearly a year, and the panel demand has been greatly different from the real sales.

Now, regarding the industry factor, we do admit that it will be quite difficult to expect a recovery that is significantly driven by a rebound in the actual end-user demand in light of the macro situation that we foresee next year. However, it's been about one year since the industry had undergone a significant inventory correction phase, and there's been a significant adjustment in the inventory levels

and also in terms of the gap or the difference between the panel demand as well as the sell-through demand.

And so we believe that inventory adjustment in the channel had taken place quite extensively. So although very minor, we are seeing positive signals where there is an inventory restocking demand that is starting to pick up.

Usually, considering the distribution and stock of the set, The distribution and sales of the set are likely to always hurt the sales of the panel, but in the past year, the amount of panels has been much lower than this flow, so in the second half of the year, we are seeing a normal recovery with a flow that follows the typical panel flow, set flow.

Now typically the market dynamic is such that the set inventory and channel inventory and sales usually is at a higher level compared to the panel sales. But over the past year it was quite unusual where the panel volume or the panel sales was much weaker compared to the set sales. And I think as we go into the second half of the year we will see normalization of this market dynamic whereby the panel volume or the sales volume

will find its alignment with the actual set sales.

And also there are three specific reasons from the company's perspective. First is the 15K capacity for mobile staff coming online, which is going to drive up the volume by about 50%. And that will be the biggest contributor behind a turnaround in profit.

And the tablet that will start operating from early next year will also contribute to the next year's results. And early next year, we will also start to see our tablet fab come online.

And as a result, we will be able to see the revenues to around 2 trillion level on an yearly basis. And that will also make contributions to next year's earnings performance. And at the same time, our order backlog for auto business is also growing. And as was mentioned previously, we will be able to drive up this business from $2 trillion to $3 trillion by next year.

We will now take the final question.

The last question will be presented by Chan Woo-Gin from Sinan Securities. Please go ahead with your question.

Thank you for the question. First of all, I would like to ask two questions. The first is a simple question about the electronic business. As you mentioned earlier, we would like to ask about the electronic business in terms of short-term or medium-term profitability. Thank you. I would like to ask two questions.

First has to do with your auto electrical business. You talked about the order backlog. We'd like to get some color on what your assessment is in terms of short to mid to long term profitability. Second question is on your OLED business. Your competitor, your domestic competitor, have announced a new investment into a bigger sheet or a higher generation investment for OLED. What is your take on this and what is your direction going forward?

Hello, I will respond to your question about the auto business. I am Ki-Hwan Son from Auto Marketing.

Now, for the auto business, rather than looking at short-term profitability, what's more important is to look at the profitability off of the order backlog. That is considered more important.

Now, for the auto business, rather than looking at short-term profitability, what's more important is to look at the profitability off of the order backlog.

Now, looking at the auto backlog, basically, profitability is on high single digit, and we will, of course, manage our order in a steady manner so that, you know, up until the time that they actually accrue revenue.

Yes, this is Kim Chang-won of Juyeong Marketing. Yes, I am Changwon Kim in charge of medium display marketing.

Before tackling your question on OLED investment, allow me to just provide our market outlook and the company strategy on IT OLED. From a mid-to-long-term perspective, within the IT product segment, depending on the level of acceptance, consumer acceptance, that is, for each of the product segments, OLED penetration, we believe, is going to be quite different per different product and per customers.

As mentioned briefly, just some moments ago,

Through the tablet OLED fab, we will be maximizing our mass production efficiency and supported by our proven experience in mass production, we will be able to further bolster our technological leadership.

And for global customers, we will verify the marketability of IT OLEDs through monitoring based on white OLEDs and providing notebook panels with tandem OLEDs,

And also against our global customers, we will be testing the economics of the OLED market by taking our white OLED-based monitor as well as notebook panels which we supply and which has the tandem OLED technology applied. We will take these products to test the OLED market or test the feasibility of our capabilities and we'll build out the high-end IT product portfolio supported by the OLED.

We will take these products to test the OLED market or test the feasibility of our capabilities and we'll build out the high-end IT product portfolio supported by the OLED.

So in light of all of these aspects, our decision for investment will consider the IT OLED market size, the speed of growth, as well as our financial strength and the amount of available investment capital.

All of those aspects will be thoroughly considered in making the investment decision. Well, with that, we will now close the first quarter 2023 earnings conference call.

Thank you very much for joining us today, and please contact the IR team if you have any further questions. Thank you.