- OLED smartphones share reached 49% in Q1 2023.
- iPhones switching to OLED was the inflection point for the tech adoption.
- 5G penetration in lower price bands limited OLED adoption and slowed the growth rate.
The share of OLED display smartphones in global smartphone sales reached a record high of 49% in Q1 2023, up from 29% in Q1 2020, according to Counterpoint Research’s Global Handset Model Sales Tracker, published in March 2023.
The screen or display has been one of the main factors influencing consumers to purchase a smartphone. OLED display provides a better viewing experience than LCD in several aspects by offering better viewing angles, deeper blacks and increased battery life along with other features. Brands also pushed OLED displays as a differentiating factor due to the leaner and more flexible panels that allow slimmer phones with curved displays in mid-priced and premium segments. Notably, the share of OLED displays in the above $250 wholesale price band reached 94% in Q1 2023.
The launch of the iPhone 12 with OLED display was the inflection point for OLED adoption in smartphones. All iPhones launched since, apart from the SE versions, have been equipped with OLED panels and the adoption of this display technology has increased with each iteration of the device.
In Q1 2023, almost half of all smartphones sold had OLED displays. The rate of adoption reached its highest ever mark in February 2023. However, beyond that the growth rate plateaued due to the following reasons:
- 5G smartphones penetration has been consistently increasing. Over half of the smartphones sold in Q1 2023 were 5G capable. A push to bring 5G to lower price bands, especially in emerging markets, is a key driving factor for this growth. However, adding 5G also meant increasing BoM costs. Due to increasing costs, certain OEMs have used LCD displays to optimize BoM costs for 5G smartphones, especially in the lower price bands. Close to half of the 5G smartphones sold globally were from the sub-$400 wholesale price band, of which 50% had LCD displays. Meanwhile, in the over $400 band, the share of 5G phones with LCD displays was just 1% in Q1 2023.
- Although 5G is advancing, LTE still accounted for over 40% of the total market with a higher presence in price-sensitive developing economies. The use of OLED displays in LTE smartphones has almost halved over the past three years as iPhones, which use OLED, have shifted to 5G, leaving the LTE market mostly to Android devices, which mostly use LCD. The best-selling LTE devices are all entry-level Android smartphones that are mostly equipped with LCD displays. This has played a major role in dampening OLED demand.
Among OEMs, Samsung has been consistently lowering its use of OLED over the years, reaching 41% in Q1 2023, its lowest level in the past three years. This was due to the rise in popularity of Samsung’s LCD-equipped A series smartphones in the entry-level segment. Among major Chinese smartphone players, only Xiaomi increased its OLED adoption, rising to 51% in Q1 2023 from just 18% in Q1 2021, helped by its popular Redmi Note series smartphones with OLED panels. OPPO’s employment of OLED displays decreased slightly YoY during the quarter while that of vivo remained flat. Devices with LCD panels accounted for more than 60% of their sales in Q1 2023. Meanwhile, realme, in its endeavor to deliver 5G smartphones at lower prices, opted for LCDs over OLEDs, thus lowering its OLED adoption to 36% in Q1 2023 from 45% in Q1 2021.
Going forward, smartphones will increasingly adopt OLED, which will cross the 50% mark driven primarily by the launch of new iPhones. Increasing popularity of foldable smartphones, which are all equipped with flexible OLED displays, will also be a contributing factor.