AU Optronics Corp. engages in the research, development, production, and sale of thin film transistor liquid crystal displays (TFT-LCDs) and other flat panel displays used in various applications. The company also engages in the production and sale of solar photovoltaic (PV) modules and systems. Segments The company operates in two business segments: Display and Solar. Display segment This segment sells the company’s panels primarily to companies that design and assemble products based on their customers’ specifications, commonly known as original equipment manufacturing service providers, and to brand customers. The company’s original equipment manufacturing service provider customers, majority of whose production operations are located in Taiwan or the PRC (the People’s Republic of China, excluding Taiwan and the special administrative regions of Hong Kong and Macau), use its panels in the products that they manufacture on a contract basis for brand companies worldwide. The company also sells its products to some brand companies on a direct shipment basis. The company manufactures TFT-LCD panels at fabrication facilities commonly known as ‘fabs’. With production facilities utilizing 3.5-, fourth-, 4.5-, fifth-, sixth-, 7.5- and 8.5-generation technologies, the company has the flexibility to produce various panels of various sizes. Principal Products The company designs, develops, manufactures, assembles, and markets a range of display products for the following principal product categories: Televisions, which utilize display panels ranging from 17 inches to 75 inches, including panels for televisions, TV sets, and other related products for televisions. Monitors, which utilize display panels ranging from 17 inches to 32 inches, including products, such as desktop monitors. Mobile PCs, which utilize display panels ranging from 6 inches to 17.3 inches, including products, such as notebooks and tablets. Mobile devices, which utilize display panels ranging from 1.6 inches to 7 inches, including products, such as mobile phones. Commercial and other applications, which utilize display panels ranging from 2.5 inches to 22 inches or above for use in products, such as displays for automobiles, industrial PCs, automated teller machines, point of sale terminals, pachinko machines, and others. Customers, Sales and Marketing The company sells its panels primarily to brand companies and original equipment manufacturing service providers with operations in Taiwan, the PRC, Japan, and other areas. Samsung Electronics Co., Ltd. and its subsidiaries accounted for 10.2% of the company’s net revenue in 2014. Suppliers Glass Substrates: The company’s major suppliers include Asahi Glass, Corning Taiwan, and Nippon Electric Glass. Liquid Crystals: The company’s major suppliers include JNC Corporation and Merck. Color Filters: The company’s major suppliers include Dai Nippon Printing and Toray Industries. Polarizer: The company’s major suppliers include BenQ Materials Corp., LG Chem, Nitto Denko, and Sumika Technology. Driver ICs: The company’s major suppliers include Novatek and Raydium Semiconductor Corporation. Seasonality The company’s business is subject to seasonal fluctuations common in the display panel industry, which in turn is affected by the seasonality of demand for consumer and other end-products produced by its customers. The company’s low seasons typically start in the fourth quarter (year ended December 2014) and might go lower in the first quarter; while its high seasons generally start in the second quarter and might go higher in the third quarter. Competition The company’s principal competitors include LG Display Co., Ltd. and Samsung Display in Korea; Innolux, Chunghwa Picture Tubes and Hannstar Display in Taiwan; Sharp Corporation, Japan Display Inc., and Panasonic Liquid Crystal Display Co., Ltd. in Japan; and BOE, Century, Tianma, China Star Optoelectronics Technology, and CEC-PANDA LCD Technology in the PRC. Solar segment This segment manufactures upstream and midstream solar products, such as polysilicon, ingots, wafers, and solar cells. The
au optronics corp (2409:Taiwan)
Hsinchu Science Park
No. 1, Li-Hsin Road 2
Phone: 886 3 500 8899
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