TIANMA(SZ:000050)2022-12-08 09:45Market Outlook - The sales of 4G products have not met expectations, with China Mobile not adjusting its annual targets for 4G products. There is potential for increased sales in the second half of the year if pricing and infrastructure issues are addressed [2]. - The transition from 3G to 4G is ongoing, and the company does not feel significant pressure from 3G product inventory, as 3G remains mainstream while 4G is in a rapid growth phase [3]. Product Development - FHD product development is slower than HD due to LTPS production line challenges, including technology and yield issues. The cautious approach of manufacturers in selecting suitable models for FHD also contributes to this delay [3]. - The company’s LTPS production line has achieved a high yield rate and is supplying mainstream high-end smartphones, with confidence in meeting project goals [3]. Pricing Trends - A price decline of 15% to 20% is expected for HD and FHD products throughout the year due to increased capacity and improved yields [3]. - The company has prepared strategies to address potential product price reductions [3]. Financial Performance - In Q1 2014, the company reported profitability due to a shift towards consumer products, primarily smartphones, with QHD shipments reaching 16,000 units and a global market share of 14%, ranking third [4]. - The focus for 2014 will be on HD products, with an emphasis on enhancing product value to drive up prices and gross margins, targeting mid-to-high-end smartphones and professional displays [4]. Technology Advancements - The company is advancing in OLED technology, having established a pilot line for AM-OLED in 2010 and recently investing in a new production line with a capacity of 15,000 glass substrates per month, expected to be operational by the end of 2015 [5]. - The company is also exploring the potential of on-cell technology to replace OGS, although market adoption has been slower than anticipated due to low acceptance rates [4]. Capital Expenditure - The capital expenditure for 2014 will focus on upgrading existing equipment to align with product structure adjustments and expand capacity [5].