Veeco sees a slowdown in flexible OLED production plans at SDC

In September 2013, Veeco acquired Synos Technology for $185 million for the company's FAST-ALD flexible OLED encapsulation technology. Veeco later received a purchase order from SDC for a first-generation FAST-ALD prototype system. Veeco expected a manufacturing ramp to begin in 2014 - hoping to book more than $75 in ALD production systems by the end of the year.

Yesterday Veeco reported their financial results for Q1 2014. While the company had a good quarter (revenues of $91 million, up 24% sequentially) the new OLED business did not perform as good as they expected. In fact, they didn't get the orders they thought they'd get in Q1 2014, which meant that Veeco will pay less for Synos - $25 million less, actually.

Veeco is still upbeat on this technology and they still see a "significant promise" for the OLED systems. it's highly unlikely that they'll manage to achieve those $75 million in sales for 2014 though. It turns out that the flexible OLED production at SDC is not growing as fast as Veeco thought it would grow and Veeco is now seeing a slower adoption then they first assumed.

Samsung is currently producing 5.7" Full-HD flexible OLED displays (also smaller ones for the Gear Fit) but in a very low capacity. Samsung's current encapsulation technology is Vitex's multi-layer technology which is slow and expensive. While it was reported that Samsung is busy upgrading this technology, we also know that they are testing alternatives, such as UDC's single-layer techonology.

Posted: May 06,2014 by Ron Mertens