Universal Display Corp at Oppenheimer Technology, Internet & Communications Conference (Virtual) Summary

The following is excerpted from the question-and-answer section of the transcript.

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : <_ALACRA_META_ABSTRACT>Thanks Brian. I would like to start with your view on the IT market. Beyond quantitative market forecasts for all that penetration in IT, what qualitative shifts in user behavior or product designs are you seeing in the IT market that excite you the most about the long-term material sales opportunity for Universal Display?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. So maybe on the topic of large IT oriented Gen 8 fabs coming online, what does those fab CapEx mean for you before they enter a mass production? Do you generate any meaningful sales as they ramp up production and into commercial production?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. And then for regarding the tandem structure, we all know LG showcased a hybrid tandem panel with your phosphorescent blue and fluorescent blue. How do you think about the market potential for the hybrid solution versus a pure phosphorescent blue? most customers are okay with this hybrid tandem structure or are they waiting until the pure blue is ready?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : And in the LG implementation, how does the material consumption for UDC compared to a more regular tandem panel?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : And then for overall tandem adoption in the market we've seen some smartphones using tandem in China and then we are seeing a wider adoption of tandem in tablet products. Going forward, where do you think, aside from IT, do you still see smartphone as a high potential market for tandem?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : And then for Apple's iPad Pro, for example, that display is one of the brightest and highest performance display in the market alongside other IT products. So do you think -- how would you characterize the commercial success of this tandem panel and do you think going forward this will make tandem a main-staying along the IP product for Apple's product lines?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. And I want to touch on blue because this will be quite an integrated topic with tandem structure going forward. Maybe first take a more retrospective view on blue. When you look at the blue development, what were the most unexpected breakthroughs or challenges you're running to that contributed to the delay in 2024?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : We talk about one of the challenges is developing a material in a very complex system. Does that make you think about maybe getting involved in more of the material development in the entire stack or forming a closer relationship with the customers or any other way to maybe remove some of the challenges in this complex system design?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : And do those collaboration agreements result in any financial upside to you and is that something you also have revenue recognized from those development agreements?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : I see. And for blue specifically, do you still see the host material for blue as a potential revenue stream once the materials are ready and passed all the commercial thresholds?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. I talk about foldable smartphones because we see a very steady increase of foldable smartphone both in shipment and market share over the years. And for you, are you developing foldable specific material stack given that the display has more durability or power efficiency concerns, anything special in the recipe?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : I see. And considering the -- so I want to move on to your exposure to Chinese market, considering that the China order patterns are getting more bulky these geographic political factors, how do you proactively manage your inventory levels across the US and Ireland?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : And would you say the capabilities in the US and Ireland, they are similar? Is there any materials that can only be produced in the US or Ireland?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : So is it right that the only difference between the US and Ireland would be total capacity where you have a bit more capacity in Ireland?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. And when it comes to capacity, there's also this question on utilization. What's the current effective utilization rate across your manufacturing facilities. Is there some optimization you currently needs to do that impact margins?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. And do you need to bring reactors online in relation to the Gen 8 fabs?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. So how would you describe your overall visibility in terms of customer demand? You talked about having ample stock in finished goods for inventory, would you say your visibility with our pretty reasonable for you to prepare ahead?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : I wanted to maybe touch on emerging sectors for all that display beyond the expected growth from IT and your potential blue adoption, what are the under explored or emerging applications for all that that you see as having significant longer term consumption potential?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : And given there's a higher performance requirement for auto in terms of various conditions, maybe resist the temperature and brightness, would you say overall there's a potential of higher adoption of tandem structuring model?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. And do you foresee in the future where autos start to become more material? Is there an inflection point or milestone you're expecting for auto to become more material to your business?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. So both the penetration rate and then the content per vehicle will rise over time.

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Thanks. I want to touch on IP, and how do you plan to evolve your IP strategy to keep protecting your leadership position against other challenges, especially as the majority of the all that industry is based in East Asia. REFINITIV STREETEVENTS | www.refinitiv.com | Contact Us consent of Refinitiv. 'Refinitiv' and the Refinitiv logo are registered trademarks of Refinitiv and its affiliated companies. AUGUST 12, 2025 / 2:45PM, OLED.OQ - Universal Display Corp at Oppenheimer Technology, Internet & Communications Conference (Virtual)

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. So I want to touch on the topic of capital allocation. So we have announced a buyback this year and in UDC's history, it's a very rare occurrence. Can you maybe speak to the context of buyback right now and overall, what's your capital allocation strategy and where buyback sits.

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. And in terms of other priorities in capital allocation, how would you rank them respectively?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : I would like to address a few questions coming from the audience. The first regarding [Summer Sprout] and then your IP protection. The question is the company has been shipping red and green materials and there are reports that those materials are being used in global smartphone models. How should investors take a lack of legal response to this development?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Another question from the audience regarding blue development. So do you have a new timeline to share on when do you expect to hit the commercial specification for a standalone blue meaning blue or in all phosphorescent RGB architecture.

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : And I want to maybe take the last few minutes to talk about your outlook for next year. Aside from quantitative guidance, and what are the things you're excited about going to next year?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Got it. Now I see no further questions from the audience. Is there any closing remarks you would like to make?

Question: Martin Yang - Oppenheimer & Co Inc - Analyst : Thank you, Brian. Thanks everyone for attending. That's a wrap.