LG Display Co., Ltd.

Good morning and good evening. Thank you all for joining the conference call for the LG Display earnings results. This conference will start with a presentation followed by a Q&A session. If you have a question, please press star and 1 on your phone during the Q&A. Now we will begin the presentation on LG Display's first quarter of fiscal year 2025 earnings results.

Hello, I'm Team Hwaseok of LG Display IR. Thank you for attending the conference call of the first quarter of 2025. Today's conference call is attended by Chief Executive Officer Kim Sung-hyun of CFO, Chief Executive Officer Cho Seung-hyun of Management Management, Chief Executive Officer Kim Kyu-dong of Finance, Chief Executive Officer Lee Ki-young of Business Intelligence, Chief Executive Officer Kim Jong-deok of Big Project Management, Chief Executive Officer Ahn Yu-shin of Middle Project Management, Good afternoon.

I'm Brian Hall, in charge of our team at LG Display. On behalf of the company, thank you all for joining us today in our first quarter 2025 earnings call. Today, I'm joined by our CFO, Kim Sung Hyun, Cho Seung Hyun, who is the VP of Business Management, Kim Kyu Dong, VP in charge of Finance, Lee Ki Young, in charge of Business Intelligence, Kim Jong-deok, VP of Large Display Planning and Management. Ahn Yoo-shin, in charge of Medium Display Planning and Management. Baek Seung-yong, in charge of Small Display Planning and Management.

And last but not least, Son Ki-hwan, VP of Auto Marketing.

This call will be conducted in both Korean and English, and for more details, please refer to the provisional earnings that was just disclosed or the IR events section on the company's website. Also, before we begin, please take a moment to read the disclaimer.

As a reminder, please note that today's results are based on consolidated IFRS standards prepared for your benefit and have yet to receive an audit by an outside auditor. I would like to talk about the business performance of the first quarter of 2025. Despite the fact that the first quarter is a time when seasonal influence appears for each product, the 1 dollar exchange rate was positively effective, adding to the high performance of the business structure in the center of OLED, and recorded a strong performance of 6.653 trillion won in sales. This is a number that has increased by 15% compared to the previous year.

Let me start by running through the business results for Q1 of 2025. Despite the usual seasonality seen during the first quarter across different product segments, driven by OLED-centric business structural upgrade, coupled with $1 FX impact adding to the positives, revenue reported a solid $6,065.3 billion, which is an increase of 15% on an year-over-year basis.

In the case of 영업소닉, with the expansion of the sales volume of OLED products according to the high level of the business structure, it continued its performance efficiency activities with high-end cost reduction and operation efficiency, and, unlike the past normal flow, it recorded a loss of 3.35 billion won according to the previous quarter, even though it was a seasonal decline. This is 5,092 billion won compared to the previous year's winter, and 1.1318 billion won compared to the first quarter of 2013. In addition to COVID-19 specialties,

coupled with increase in revenue share of our OLED products following business structural upgrades and stringent cost savings and operational efficiency activities continuing, despite it being a slow season and unlike typical trends seen in the past, operating profit reported 33.5 billion won, sustaining the profit-making streak since last quarter. This is an improvement of 509.2 billion won on a year-over-year basis and 1 trillion 131.8 billion versus Q1 of 2023, which is quite noteworthy in that we were able to generate profit in the first quarter for the first time in eight years, except for the special period during the COVID pandemic.

1.1 billion won is 1.23 billion won, and the EBITDA margin rate is 20%. 21년 3분기 이후 가장 높은 수준을 기록하였습니다. 다음은 출하 면적과 면적당 판가 추이입니다. 1분기 출하 면적은 중대형 패널의 계절성 영향이 반영되며 전풍기 대비 19% 감소하였으나 Next is area shipment in ASP per square meter.

Area shipment in Q1 was down 19% Q on Q on the back of seasonality impact on mid to larger panels, while on a year-over-year basis, driven by panel shipment expansion for OLED TV and notebooks, there was 1% increase.

ASP per square meter recorded $804, which is down by 8% Q on Q. Considering how prices tend to fluctuate during the first quarter,

The decline was very much mitigated thanks to robust OLED performance.

Moving on to product revenue mix.

On subdued seasonality, mobile and others' revenue dipped 8 percentage points queue-on-queue, reaching 34%, while revenue share of other product segments expanded on a relative basis.

IT department's sales volume recorded 35%, which increased by 7% compared to the previous year, based on the increase in sales of IT OLED panels, and TV department's sales volume recorded 22%, which is the same as the previous year.

IT segment revenue share was up 7 percentage points Q&Q, recording 35%, underpinned by increase in shipment of OLED panels for IT. TV segment revenue was flat Q&Q at 22%, while auto segment revenue mix increased 1 percentage point Q&Q, accounting for 9%.

전체 매출 내에서 OLED 제품군의 비중은 전년 동기 대비 8%포인트 상승한 55%를 기록하며 당사가 추진 중인 OLED 중심의 사업 포트폴리오 전환 성과는 지속적으로 확대되고 있습니다.

OLED mix out of total revenue increased 8 percentage points year on year reaching 55% as we continue to see expanded outcome from the company's transformation of OLED-centric business portfolio.

다음은 재무 현황과 주요 지표입니다. 1분기 재무생 투표상의 현금 및 현금성 자산은 9823억 원이나, 이는 매각이 예정되어 있던 중국 광조 LCD 공장이 보유하고 있는 현금이 회계 기준에 따라 매각 예정 자산으로 재분류된 후 잔액이고, 이를 포함할 경우 회사가 보유한 실질 현금 및 현금성 자산은 2조 3728억 원입니다.

Next is financial position and key metrics. Cash and cash equivalent, as stated in Q1 financial statement, is 982.3 billion won. But if we were to include back cash held by China's Guangzhou LCD plant, which has been classified under assets held for sale, in terms of actual cash and cash equivalent that the company owns, it will amount to 2,372.8 billion won.

Next is the second part of the guidance. Next is Q2 guidance.

Generally, we see area shipment to uptrend during the second quarter, But following discontinuation of LCD TV business, we expect second quarter area shipment to decline by around mid 20%. And conversely, ASP per square meter is expected to rise by around 20% level.

이어서 당사 CFO 김성현 부사장의 하이라이트가 있겠습니다.

Next, I invite our CFO 김성현 to run through the highlights.

안녕하십니까? CFO 김성현입니다. Good afternoon.

I'm Kim Sung Hyun, the CFO.

Thank you all for joining our earnings call today. It is facing a business environment with higher variability than ever before, but the company has made meaningful achievements in continuing the black market trend of the first quarter, which is a seasonal downturn, even in this uncertain environment. This can be said to show that the strategy that has been built on the core of OLED to strengthen the business system and promote high-price innovation and activities is gradually continuing to be effective.

Aside from uncertainties in the downstream market, various factors continue to emerge, such as the shifts in the global trade environment. Although we face heightened level of volatilities in the business backdrop, we were able to drive meaningful results by way of sustaining the profit-making streak even during the first quarter, which is known to be a slow season.

This is a result of our strategies that solidified our fundamentals, including the OLED-centric structural upgrades, rigorous cost innovations, which gradually drove better performance.

Although external uncertainties may persist for the time being, we are beginning to see tangible results from the efforts that we've placed behind strengthening core competitiveness. And as such, we will continue to endeavor to achieve a turnaround in annual profit and further grow the size of that profit.

If I were to tell you about the plans and strategies for each area of the business, in the case of mobile OLED business, based on customer trust and the strength of the production capacity of the party, Next moving on to plans and strategies for each business domain.

OLED for mobile has won greater trust from the customers, and based on stronger production capabilities, we've been able to continuously expand our presence in the high-end market. Going forward, underpinned by competitive capabilities in technology and stable supply, we plan to enhance core competitiveness, such as quality and cost, to drive and sustain shipment expansion. Also, by responding nimbly to fast-changing markets, We will prepare in a structured way to be ready for future technologies.

The IT OLED segment will closely observe the market situation and respond to the changing flow of the forward market. In the case of the IT OLED segment, it is clear that the discriminatory user value of Tandem OLED, which has excellent durability and performance such as low power, long life, and high degree, We will be closely monitoring how the market moves

and be agile in responding to changes in the downstream market. In IT OLED, there is clear and distinctive user value that Tandem OLED offers, with its outstanding performance and durability features, including low power, longer life, and high luminance. Thus, we expect there to be year-over-year growth in shipment in 2025. And supported by technological leadership and stable mass production experience that's been accumulating over the years, We will further solidify our market position and effectively respond to changes in the environment.

We will use differentiated high-end LCD technology to provide products that are optimized for the needs of customers in each product area and cooperate with global top-tier customers leading the market in the high-end area to respond to competitive situations and achieve results. At the same time, we plan to continuously improve profitability by continuing high-end price innovation and operational efficiency efforts.

In IT LCD segment, we will leverage differentiated high-end LCD technologies, including IPS Black and Next Generation Oxide, to deliver optimized products that meet customer needs in each product segment. And by collaborating with global top-tier customers who are spearheading the high-end segment of the market, we will respond to competition and drive results. Also, through rigorous cost-based innovation and operational efficiency efforts, we plan to sustain bottom-line enhancement.

In large panel business, following the closing of sale of Guangzhou LCD TV Plant, revenue from large panel may start to decline starting the second quarter of this year,

as LCD TV revenue will no longer be captured, but through this strategic decision, we are able to place greater focus on OLED-centric structural upgrades.

대형 OLED 사업은 OLED만의 차별화된 가치를 기반으로 하이엔드 시장에서의 입지를 강화하고 있습니다. 글로벌 고객들과의 긴밀한 협업을 지속하고 있고, 저전력, 고위도 등의 특성이 한층 강화된 4세대 OLED TV, gaming monitors, etc., we are expanding our premium products, so we are looking forward to positive results in the future. At the same time, we plan to continue efficient operation strategies and cost reduction efforts that can respond flexibly to demand changes and continue quality growth that improves profitability in the long term along with double growth.

For large OLED business, underpinned by distinctive value of OLED, we are solidifying our market presence in the high-end segment. As we maintain close collaboration with global customers in order to expand differentiated and premium product portfolio, including gaming monitors and Gen 4 OLED TVs, whose values, such as low power and high luminance, are even more improved, we expect positive performance hence will follow. We will also continue to run efficient operational strategy and curve-cutting efforts to respond nimbly to changing demand and consequently drive mid- to longer-term volume growth coupled with quality-driven growth accompanied with profitability enhancements.

Next is auto business. There are some changes in the entire automotive market, but the display of the vehicle is continuously expanding, and the acceleration of the large area is also positive for OLED and LTPS LCD screens, which are the main focus of the company. The company's vehicle business is Next is auto business.

Although volatility can be spotted across the overall auto market, in-vehicle display adoption continues to expand, and accelerated shift towards larger size panels works to the advantage of the demand for our core products, OLED and LTPS LCD. For the auto business, we will fortify our position as global number one in terms of differentiated products and technology portfolio, which includes plastic OLED, ATO, high-end LTPS LCD. And coupled with sustainable growth, we plan to build up a stable earnings structure.

I will tell you about the investment activities. Last year's investment amount was 2.2 trillion won. Lastly, on investment activities.

Investment last year amounted to 2.2 trillion won, and investment in 2025 is expected to be around mid to low 2 trillion won, in line with the communication made last quarter.

The company maintains a business management structure centered on profitability, and the investment is also continuing the principle of consulting and managing from a conservative point of view, considering the environmental change and the changes in demand. Therefore, the investment is going to take the most advantage of the existing infrastructure and carry out new investments in the future, considering profitability as the top priority.

We maintain profit-focused business operations, and as we are mindful of changing external environment and ensuing fluctuations in demand, we adhere to the principle of keeping to a conservative stance when it comes to reviewing and running the investments. We will fully maximize the use of our infrastructure that we currently own and be prudent in making capex spend and profitable capex spend. and profitability will be of utmost priority when we make new investment decisions in the future.

Thank you. We will now begin the Q&A.

Operator, please proceed. 지금부터 질의응답을 시작하겠습니다. 질문을 하실 분은 전화기 버튼에 별표와 1번을 누르시기 바랍니다. 질문을 취소하시려면 별표와 2번을 누르시면 됩니다.

원활한 회의 진행을 위하여 질문은 한 분당 두 가지 이내로 부탁드립니다. Now Q&A session will begin. Please press star 1, that is star and 2, if you have any questions. Questions will be taken according to the order you have pressed the number star 1. For cancellation, please press star 2, that is star and 2 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 each participant. The first question will be provided by Dongwon Kim from KB Securities. Please go ahead with your question.

Yes, thank you for the question. The first question is about the recent U.S. tariffs. I wonder if there has been a change in the market and customer movement. Please tell us about the LG display replacement method. The second question is, according to the April 11 announcement, I remember that there was a change in the price of the Guangzhou LCD TV factory. If you have anything to update on this, please. That's it.

Thank you very much for taking my question. My first question would like to understand as to whether there are any changes that you are able to identify in the downstream market as well as in your customers with regards to the United States tariff that is quite hotly debated of recent, and also would like to know as to how LG Display could respond to such development. Second question is, as per the disclosure made on April the 11th, There was a disclosure on the sales proceed with regards to the sale of LCD TV plant at Gwangju. Is there any information that you could update us on?

Yes, I will tell you about the CFO. As far as the U.S. tariffs are concerned, This is the CFO.

I will take your question. With regards to the imposition of the United States tariff, I understand that the direction going forward is towards imposing such tariffs.

As you would appreciate, a tariff policy does not singly target the tariff per se.

There are multiple issues that are relevant in terms of the relationship that a country has with another, and I believe that tariff policy is used as a means to deal with those multiple array of issues.

In a nutshell, what I mean to say that there is quite a bit of volatility that is embedded in the implementation of the tariff policy per se.

And as you would know, basically it is rare that our product would directly be exported into the U.S.

market.

As you know, the companies that are directly facing the tariff issue are the set makers, and we are hence very closely monitoring as how these set makers will determine their production base going forward and the strategies related to their production base.

As far as we know, there are no set makers that are modifying the production strategy.

But as far as we know and based upon what we had researched as of today, we understand that there are no set makers at this point who have changed their production-based strategy.

As I mentioned earlier, we are fully aware that there is a possibility of change depending on the direction in which the policy changes. As a result, we have been keeping an eye on And so...

What we know is that in terms of how the policy is actually going to play out into the future, which direction that it will take, it is still open to fluctuation. It has not yet been completely determined, so hence there are certain uncertainties. That is why we are very closely observing and following what is happening with regards to these policy implementation, and we will come up with an appropriate countermeasure to deal with the developments that take place to make sure that we control the situation, that we don't lose out on any business opportunity, or that we don't, so the developments don't undermine our profitability.

And what you might be most curious about is that we don't have any problems or issues with the SCM chain. And what you might be most curious about is

I believe one of the things that you'd be most interested in is whether there are any critical issue points across our SCM, our supply chain. I can tell you that there are no critical issues that at this point we believe will exist. And also in terms of any pressures on our pricing, we believe that there is no price pressures that we'll be exposed to because of this issue.

Second, you asked a question related to Gwangju HDTV. First of all, the content that was revealed in the formula is based on the amount. That's exactly right. That's right. I think you can see that there is almost no change there. And I know that the full operation is currently underway at CSOT on April 1. It is confirmed that it is going very well without any problems. And according to the plan, the foreign exchange loans were originally planned to be paid. According to the plan, the foreign exchange loans have been paid and we are paying for them. I think you can think that this part is now over. Maybe in the first half of the year, It's a meaningful amount of cash. I think you can think of it as an investment. And what you're most curious about is... Where are you going to spend that money? We're... The company... To think about it... This money is one place. Rather than focusing on everything. The company... A little... Parts that require urgency. Yes, and then moving on to the second question about the sale of the entity that we have, the LCD TV plant at Gwangju.

As per our disclosure that we have previously made, the amount of the sales proceed is the correct amount. There is almost no change to the figure that we had previously disclosed. And we've been informed that as of April the 1st, CSOT is running that plant at full capacity, meaning that the plant is currently running without any significant issues. And in terms of the sales proceed, we are being paid, meaning we are receiving that payment as per the payment schedule. And so with regards to this sales transaction, I can tell you that more or less the whole transaction is now closed. So in the first half of the year, we are looking forward to a meaningful amount of cash in into the company. Second part, I'm sure you're also interested as to where we will be using this sales proceed. The company's thoughts are that we will not be concentrating the use into one specific area, so we will not be using the whole amount to one certain area. We are mindful of different aspects in terms of urgency of certain business and preparations for the future and the operation. Now, based upon the assumption that all of those areas All of those factors, that there are no issues, we will be making the decision as to where we will invest that amount.

To sum up, the current operation-related cash flow is being cut off by the business. In that case, the cash flow coming out of that market will be used in the financial structure, So let me backtrack on this and just give you a clear message on this.

Basically, in terms of the cash flow requirements for our operations, we are able to fund that through the operational activities. So the sales proceeds that we will get, the cash flow that will come in, we will use part of it in improving the financial standing, and also there may need to be some investment that we make to better prepare for the future and to strengthen our business capabilities in terms of the OLED business.

Next question, please.

다음으로 질문해 주실 분은 IBK 투자증권의 김은호 님입니다.

The following question will be presented by Winyo Kim from IBK Investment and Securities. Please go ahead with your question.

네, 질문 기회 주셔서 감사합니다. 세 가지 정도 질문인데요. 일단 첫 번째는 앞서 CF님께서 충분히 설명을 많이 해 주신 것 같기는 한데 대외 불확실성 관련 질문입니다. 역시 상황이 그렇게 좋지는 않아 보이는데 기존 사업 전망에 어떤 변화가 있을지가 궁금합니다. 물론 전략 고객 사업 중심으로 설명해 주시면 감사하겠습니다. 두 번째는 역시 전략 고객 향 관련 질문인데요. 공급사 간의 경쟁 심화가 계속 진행이 되는 걸로 얘기가 들립니다. 이에 따른 물량 변화나 판가이나 압력이 혹시 나타나는 게 없을지에 대한 질문입니다. 이 부분에 대한 설명 부탁드리고요. 그리고 마지막으로는 In the second half of the year, new products will come out every year, so it will come out this year, but it seems that there is a rumor that it will come out as a model for the LTPO. What good things will happen to our company when this happens? I would like to explain this situation one last time. Thank you.

Thank you. I would like to ask you three questions. Although the CFO gave us a quite good explanation on this, I just would like to follow up by asking, the external uncertainties do not seem very good, so I would like to understand whether you have made some adjustment into your business plan outlook going forward, and particularly in relation to your strategic customers. Second question also regards your strategic customers. There seems to be heightened level of competition amongst the suppliers. We'd like to know whether that is impacting the amount of volume shipment that you're making to each of these customers or whether you're exposed continuously to any pressures, downward pressures on ASP. And then the third question is, in the second half, we always used to get new products. There is a rumor in the market that the new products will all be based on LTPO technology. If that is the case, what good news would that be for LG Display?

This is Baek Soon-yong, CEO of Soyoung Project. There is definitely a lack of flexibility due to tariffs. However, customers are first of all responding through a variety of production areas and are watching the future trends. Hello, I'm in charge of small display.

Responding to your question, yes, there is definitely uncertainties coming out of the tariff-related developments. but basically the customers are at this point diversifying their production base, and so we expect that multiple companies will continue to pay close attention to how things go going forward. In terms of the smartphone business that we engage in, we have very strong capabilities and our strategic position is quite robust, so we are running our business as per our original business plan.

But having said that, there may be downstream market volatilities, so we are in close communication with our customer base, and we are fully prepared to nimbly respond to changes in the market.

And competition amongst the suppliers and vendors have always existed, but we were able to prove our differentiating points through timely supply of the products and volume to our customers and also through making appropriate preparations for upcoming future technologies. And through continuous cost innovations and strengthening of quality as well as other competitive factors, we were able to expand to the volume that we supply, and through such commitments, we will effectively respond to competitive landscape.

Even though the first half of the year is a seasonal trend, there is a significant increase in volume based on the trust of the customers, their own technology, and production capacity. In the second half of the year, there is a significant increase in volume based on the trust of the customers, their own technology, and production capacity. In the second half of the year, there is a significant increase in volume based on the trust of the customers, their own technology, and production capacity.

So despite the fact that the first half of the year is usually the slow season, thanks to the trust that we have from our customers and our strategic positioning as well as our production capabilities, we expect there to be an year-over-year increase in volume. And the second half of the year, we will continue to see more expansion through the shipment volumes, especially coming out of the new models. So we expect to achieve a YOY performance that is on par with what we've seen the previous year.

Next question please.

The following question will be presented by Won Seok Jeong from Insecurities.

Please go ahead with your question. I would like to ask two simple questions. Recently, the CDTV business has ended. In a situation where we have to focus on large businesses with OLED TV, there is a lack of demand right now, and the high-end market growth is also stagnant. I wonder how the strategy to respond has come about. And in a situation where there is a lot of uncertainty, such as recent tariffs, I would like to ask if there is a change in the fall plan this year. Thank you.

Thank you for taking my question. I just have two very simple questions. Since you've discontinued your LCD TV business, for your large business, I take it that you have to focus on your OLED business. But in light of the uncertainties and the demand and the fact that the high-end market segment is currently stagnant, I would like to understand what strategies you have in place. Second question is that on top of the tariffs as well as uncertainties in the market, I would like to know as to whether that drove any changes to your overall shipment plan.

Yes, I am Kim Jong-Duk, the director of the project management of the large-scale business. First of all, I would like to say that the large-scale business can be divided into two branches under the current profit-oriented business management framework. One branch is My name is Kim Jong-Dok. I'm VP in charge of large display.

I will take your first question. on the profitability side. Basically, I can divide that into two pillars. We operate our business under a profit-centric operational stance, and it's made up of two pillars. In terms of responding to what the customers need, we are focusing and providing a differentiated product portfolio that has distinct product specifications as well as sizes. So by strengthening the portfolio, we will be responding to the need. And the second pillar has to do with an ever-stringent cost-savings effort. So through these two approaches, we are committed to stay in line with the plan towards the objective of enhancing the business performance.

And according to your question, we are planning on how much we will increase the large OLED business as we finish the LCD TV business. So, the current large OLED business is, first of all, because we have uncertainty in the market, we operate our operation Kepa based on real demand. Next, we are doing a little more extreme cost reduction activities. The third in the customer side is to strengthen cooperation with global customers. The fourth is that we have been continuously strengthening the revenue structure through some kind of differentiation and expansion in the OLED monitor business, so in the medium term, we are currently making additional positive growth

And the second part of the question, yes, we've decided to discontinue the LCD business, which means that in our large panel OLED business, we will focus our efforts to further enhance and notch up that business, and things are going as planned. So looking overall at our large panel OLED business, because of the existing uncertainties in the market, We have linked actual demand of the market onto the capacity, the operating capacity of our business, and also we've taken cost-cutting activities to the extreme. That's the second part. And third, we've strengthened our cooperation with the global customer base. And fourth, we have expanded and differentiated LG Display's very distinctive products, such as OLED monitors. So through these different efforts, we are really strengthening our earnings structure. So from a mid-to-long-term perspective, we're seeking to drive growth in terms of volume, which will bring us a steady performance.

And lastly, OLED products are lined up with global top-tier customers, and as you know, they are in the top position in the market. So, OLED is actually at the top of the product lineup at the top tier customers, and OLED itself has a top tier positioning in the market.

We do expect that there will continue to be competition against LCD, but underpinned by the very distinctive value that only OLED can offer, we are committed to strengthening its positioning in the high-end segment of the market.

And the second question you asked about tariffs, the CFO has already given a general explanation. From the perspective of the TV set, there was some confusion due to the change in the short term of the tax policy, but the tax impact on the current large TV business is currently limited. However, depending on the changes in the future, since tax is an issue of the set company, we will do our best to improve the flexibility of such supply in the current situation.

Regarding your question on tariffs, our CFO has provided you with the overview or the high-level explanation regarding tariffs. But with respect to the changes in the tariff policy that hinges on the TV set, there's been some mixed impact. But I can tell you that for now, in terms of the large panel business, the TV set business, the impact at this point, we believe, is quite limited. But going forward, subject to how the tariff policy is actually going to play out into the future, the entities that will directly be impacted are the set makers. So we are committed to doing our best to make sure that we secure flexibility in terms of supply against our customers.

We'll take the next question.

The following question will be presented by Sung Kim from Kiwoom Securities.

Please go ahead with your question. Secondly, not only us, but also other panel companies have seen a constant increase in the number of IT OLED products and technologies. We would like to share a strategy or a practical improvement plan that can maintain competitiveness in the high-end market. In addition, we would like to ask if it is possible to share a business reduction or efficient plan of IT LCD as well as LCD TV. Thank you. I will ask two questions on your IT panel business. The demand for IT panels and the uncertainties is continuing and persisting. So what is your outlook for the IT product demand by each different product segment for year 2025? Second question is, not just LG Display, but your peers have all been able to up their technology standards. So the standard itself has become very elevated. So how do you differentiate yourself in the market? How can you continue to sustain your competitiveness in the high-end segment of the IT market? Do you have, you know, with regards to the ITLCD efficiency planning, what are some of the ways for you to improve on your profitability as you go forward?

I'm Ahn Joo-shin, the head of the Central Planning Department. At the beginning, I had some expectations about the positive effects of high-end and BTV demand, such as replacement demand and maintenance end. Currently, there is a need for continuous monitoring of demand changes due to the increase in the amount of tax on goods in the U.S. and the increase in macro uncertainty. It is expected that there will be a high flow of discussion by product and region depending on the amount of tax on goods in the future. As the change in the global market can occur, we would like to respond to the changes by communicating closely with customers about the market situation.

Yes, I am Anyu Shin. I am in charge of medium display. Responding to your question, originally we were looking forward to some positive impact coming from the replacement demand and the discontinuation of Window 10, having and triggering the market demand in the high end as well as the B2B market. But at this point, with the talk of the reciprocal tariffs that will be imposed by the U.S., and with the prolongation of the macroeconomic uncertainties, we do need to closely and continuously monitor how the demand dynamic changes as we go into the future. So depending on the decision on the imposition of the tariff by different countries and the extent of that tariff, the actual impact could surface quite differently depending on which product segment you're talking about and depending on different geographies. So there are potential for continuous volatility to emerge in the downstream market. So we are committed to very closely communicating with our customers in regards to the market situation and respond accordingly.

And our assets are equipped with high-end LCD technology such as IPS Black and OXIDE, and we have a separate technology in Tandem OLED, which has the advantage of high degree of control and long life. Based on this,

So we have technological edge in terms of high-end LCD technology that includes the IPS black and next-generation oxide technology, as well as in tandem OLED that's known for high luminance, low power, and long life. And underpinned by these technological strengths, we are able to offer the most optimized portfolio that best befits the needs of the customer for each of the product segments. And that is the way in which we respond to competition.

We are looking forward to the growth of OLED monitors along with AYPC. High-definition low-power solution and large OLED technology are expected to be more competitive. By applying these different technologies,

Now, going forward, our forecast is that there will be growth from the OLED monitor market on top of the AIPC growth from a mid- to longer-term perspective. And hence, we believe that our capabilities in AIPC the mid to large OLED, especially on high picture quality and low power solutions, our competitiveness will be further solidified as we move into the future. So by bringing such differentiated technologies to bear on the products that we offered, we will be able to continuously lead the market as we have a very solid base of tier one customer base, and that really works to our advantage.

So across the entire IT segment, the level of competition between and amongst the panel providers is becoming more fierce.

However, Through very stringent cost innovation as well as achievement of operational efficiencies and really focusing on our top-tier customer base and through strengthening the partnership that we have, we will continuously and gradually notch up our profitability.

We will take the final question before we close.

마지막으로 질문해 주실 분은 UBS의 윤종현 님입니다. The last question will be presented by Jonghyun Yoon from UBS. Please go ahead with your question.

네, 마지막 질문 기회 주셔서 감사합니다. 저는 오토 사업 관련 질문을 드리고 싶은데요. 오토 디스플레이 시장의 단기 및 중장기 전망을 좀 어떻게 보고 계시는지 그리고 이어서 LG 디스플레이 오토 사업의 중장기 성장 Thank you for taking my question.

My question relates to your auto business. Can you provide us some color on what your take is for your short-term and mid- to longer-term outlook for your auto business? And also, what's the forecast for LG Display's auto business growth and profitability going forward?

Yes, I'm Sung Jae-hwan from Auto Marketing. First of all, the car market this year was originally in a progressive recovery stage, but due to recent tax issues, electric car growth and long-term decline in Europe and the United States, the entire car market is now judging that it is difficult to exceed 90 million cars this year. Fortunately, the car display is used regardless of the electric car and the internal combustion engine, Yes, I am Son Ki-hwan.

I'm VP in charge of auto marketing. If you look at the greater auto markets, we are in the gradual recovery phase, but there are certain issues that have newly emerged, such as the tariff issue as well as the slowing of the EV growth. and the OEMs in Europe and U.S. have been experiencing quite a bit of stagnation. Because of all these factors, this year we expect that it will be quite difficult for the overall auto market to report more than 90 million units of vehicles. But having said that, fortunately, if you look at in-vehicle display, regardless of whether a car is an EV or IC, we see on per-vehicle basis the percent of adoption of vehicles such displays is increasing, and we see accelerated speed of shift to a larger tunnel. And so we are looking forward to growth, continuous growth, this year of LTPS LCD and OLED market.

Yes, the auto business has grown by an average of 10% in the last four years since 2020, and we expect to see a stable growth rate of similar levels in the next three years. So the auto business since 2020, for the past four years, it's posted a growth on a category basis of around 10% over the past four years.

So from a mid to longer term perspective going forward, at least for three years to come, we're expecting a steady growth trend. And compared to our peers and competitors, we were successful in transitioning to LTPS LCD and supported by large-scale OLED orders that we hence expect and project there to be steady growth.

Especially, we expect that OLED will increase three times in the next three years, starting with European and American customers and now expanding to Korean and Japanese customers. In particular, for our OLED display products, we started with customers in Europe and U.S., and now we are able to expand to customer base in Korea and Japan as well.

So going forward, in three years' time, we are expecting to triple the revenue compared to where we are today. And going forward, we will actively leverage new technologies such as pillar-to-pillar display, switchable privacy, and tandem, which are OLED and LCD differentiated technologies that we have. Supported by these new techs, we will further strengthen our top-line revenue as well as our bottom line and solidify our leadership in the market.