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Electronics Production | July 22, 2010

LCD monitor inventory close out becomes the top priority in 3Q10

Based on the latest survey by WitsView, in June, shipment of top ten LCD monitor SI dropped 8.3% MoM to 12.01M units, recording three months of consecutive decline.
2Q10 shipment grew by 0.8% QoQ to 38.65 million units. The inventory among brand vendors’ retail channels was on the rise because of the weak demand in traditional IT slow season and the influence of the European debt crisis. Moreover, it remains uncertain when the panel prices will rebound. Hence, inventory closeout is the top priority among brand clients, reflecting the rather conservative product pull-in. If the pressure of inventory closeout is relieved, coupled by the strategic preparation for 4Q10 demand, WitsView estimated that shipment of top ten SIs may grow 6-8% QoQ.

In June 2010, LCD monitor shipment from global top ten brand vendors increased by 4% MoM to 11.17 million units according to the latest survey by WitsView. The shipment growth momentum was mainly from 1H10 sales target,
coupled by the restock in preparation for summer vacation in markets of Europe and the US. However, the overall LCD monitor shipment almost remained flat QoQ to 33.14 million units. 3Q10 demand didn’t appear a substantial
recovery presently since the inventory hasn’t been cleared away and upstream panel prices continued to fall. Linda Lin, an research manager of WitsView, indicated that looking into 2H10, the annual financial performance may be affected if gaining market share remained the primary target among brand vendors. Hence, currently, most of them tended to reserve their profit. Under the premise of that, WitsView estimated that shipment of top ten brand vendors may post an increase by 6~10% QoQ in 3Q10.

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