Novaled (Client registration required) has filed with the U.S. Security and Exchange Commission (SEC) for its proposed initial public offering (IPO). The company is a developer of dopant and transport materials for organic light-emitting diode (OLED) displays and lighting. (For more on these markets see the reports “Sorting Hype From Reality in Printed, Organic, and Flexible Display Technologies” and “Finding the End of the Tunnel for OLED Lighting.” (Client registration required)
Novaled seeks to raise $200 million in its IPO, which will be listed on the New York Stock Exchange (NYSE) or NASDAQ. The company’s financial records, which it released with its filings, indicate revenues of €6.8 million and €17.4 million in 2010 and 2011 respectively, reaching profitability in 2011. This development primarily derives from its materials, produced by BASF, being incorporated into commercial Samsung Mobile Display (SMD) smartphone displays. SMD accounted for 59% of its 2011 revenue.
The application in SMD smartphones also indicates that Novaled has a validated product for improving OLED performance through power efficiency and lifetime enhancement.
Smartphones will be the dominant application for OLED displays through 2017 (see the report “Cutting Up the LCD Pie: Calculating the Billion-Dollar Slices from Display Innovation” (Client registration required). With this application market the power savings of the material is most important to extend battery life, while the short lifecycles of smartphones minimizes the impact of lifetime enhancement.
However, while 75% of Novaled’s revenue came from Korean firms, much of its remaining revenue came from Europe – indicating that it’s not doing much work with Japanese, Taiwanese, and Chinese OLED display developers such as AUO and Sony. These players will inevitably begin to take OLED display market share from SMD and LG Display.
In addition, Novaled’s work in Europe indicates that it believes that OLED lighting remains a viable market, as it claims in the SEC filing that the OLED lighting market will be at least $3.5 billion in 2018. By contrast, we project a $58 million 2020 market for OLED lighting (Client registration required). Novaled is well poised now for near-term growth through its supply of SMD and LG Display, but faces a rockier future if it continues to rest its hopes on significant revenue from OLED lighting and static OLED display market shares.
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