Universal Display (NASDAQ:OLED) reported record results for 2025 and outlined a 2026 outlook that management said reflects continued OLED adoption across a widening range of end markets, alongside ongoing investment in research and customer support. The company held its fourth-quarter and full-year 2025 earnings conference call on Feb. 19, 2026.
Record 2025 results and fourth-quarter performance
President and CEO Steve Abramson said the company delivered record 2025 revenue of $651 million, with operating income of $249 million and net income of $242 million, or $5.08 per diluted share. Abramson attributed the results to “strong execution across the business” and continued expansion of OLED adoption across consumer electronics, including wearables, smartphones, tablets, laptops, monitors, and TVs.
- Material sales: $353 million
- Royalty and license revenues: $275 million
- Adesis revenues: $23 million
Universal Display’s 2025 revenue included a $14 million cumulative catch-up adjustment, compared with $11 million in 2024. Total gross margin was 76% for 2025 versus 77% in 2024. Operating expenses were $248 million, down from $260 million in 2024, and operating margin improved to 38% from 37%. The company ended 2025 with $955 million in cash, cash equivalents, and investments.
For the fourth quarter of 2025, revenue was $173 million, up 7% from $162 million in the year-ago period. Fourth-quarter results included a $10 million cumulative catch-up adjustment, compared with $5 million in Q4 2024. Material sales were $96 million versus $93 million a year earlier, with green emitter sales of $74 million (up from $67 million) and red emitter sales of $21 million (down from $25 million). Royalty and license fees were $73 million, up from $64 million. Fourth-quarter operating income was $67 million (a 39% operating margin), and net income was $66 million, or $1.39 per diluted share.
Strategic focus: architectures, IP, and the push toward blue
Abramson said the OLED industry is evolving beyond single-stack architectures as new applications and performance targets drive exploration of approaches including tandem OLED structures, phosphor sensitized fluorescence (PSF) and other hybrid architectures. He emphasized that phosphorescent materials remain “foundational” across architectures and said the company’s materials are designed to work in PSF and hybrid stacks alongside fluorescent emitters.
Abramson also highlighted the company’s R&D platform, noting increased investment in in-house materials discovery, device modeling, and characterization, alongside emerging use of AI and machine learning tools to accelerate research. He pointed to ongoing progress on phosphorescent blue, saying the company is “deeply engaged with multiple customers” and believes the technology can enable up to a 25% improvement in OLED panel energy efficiency once adopted.
In Q&A, Millard said blue remains in a developmental phase and that progress toward commercialization is largely dependent on customers’ efforts to bring products to market. He added that reported blue revenue was $800,000 in Q4 and $4.3 million for full-year 2025, and suggested modeling “around the zone” of recent years, noting that small amounts of material can support significant development work.
Market and capacity: IT, automotive, foldables, and Gen 8.6 ramp
Management described a broadening OLED opportunity set, with Abramson citing Omdia forecasts that global OLED shipments are projected to surpass 1.4 billion units by 2030. He cited Omdia projections for:
- OLED smartphones: 810 million units in 2025 to 967 million units by 2030
- OLED IT (tablets/notebooks/monitors): 27 million units in 2025 to 92 million by 2030
- Automotive OLED: 3 million units in 2025 to 14 million by 2030
- Foldable OLED: 19 million units in 2025 to 71 million by 2030
On manufacturing, Abramson said installed OLED capacity (in square meters) increased by about 10% between year-end 2023 and year-end 2025, and he expects another 10% increase from the end of 2025 to the end of 2027, driven primarily by Gen 8.6 capacity for IT and automotive. He called 2026 a milestone year, with the world’s first Gen 8.6 OLED facilities—Samsung Display in Korea and BOE in China—entering mass production.
During Q&A, Millard said Samsung’s Gen 8.6 fab is not expected to come online until sometime in Q2, with BOE “shortly thereafter,” and that the company does not expect a full year of output from those facilities in 2026. He said the ramps are incorporated into guidance and contribute to a more second-half weighted revenue profile, alongside a “heavy product cycle orientation” in the second half.
2026 guidance, margin drivers, and capital returns
For 2026, Millard guided revenue to $650 million to $700 million. He said the company expects a materials-to-royalty and licensing revenue ratio “in the ballpark” of 1.3 to 1. Total gross margin is expected to be about 74% to 76%, which Millard attributed to higher raw material pricing. He specifically cited iridium as a key raw material that has fluctuated in price, and said the company expects to sell products in 2026 that include higher-cost iridium. He added that increasing materials complexity and performance can also change raw material quantities and types, influencing costs.
Millard also said the company is not expecting significant pricing adjustments in 2026 and that raw materials are the key driver behind the forecast gross margin decline from 2025 levels. In a separate response, he said gross margin has also been modestly pressured over time by “volume pricing,” with average selling prices declining slightly as the industry has grown and scaled.
Operating margin is expected to be 34% to 37% in 2026. R&D and SG&A expenses are both expected to grow in the mid- to high-single-digit percentage range year over year, reflecting continued investment in technology. The effective tax rate is expected to be approximately 19%.
Regarding seasonality and inventory, Millard said the company expects “more of a return to our historical pattern,” with the second half stronger than the first half. He said 2025 was “a bit of an anomaly” due to tariff-related buying in the first half by Chinese customers and added that the company believes most of that buying has “worked its way through” as it exited 2025.
Millard also addressed cumulative catch-up adjustments, saying changes were driven by revisions to third-party market forecasts that the company uses for out-year estimates in its revenue recognition process. He said the catch-up is calculated across customers and not tied to a specific end market.
On shareholder returns, Millard said Universal Display repurchased about 454,000 shares for $53 million during the fourth quarter and thus far in Q1. Combined with dividends, the company returned about $139 million over the last 12 months. The board approved an increase to the quarterly cash dividend, with a $0.50 per share dividend payable March 31, 2026, to shareholders of record as of March 17, 2026.
China competition and LG contract status
Asked about competition in China, management acknowledged an “increased competitive environment” in recent years. Millard said China remains a critical and growing market and that the company is investing further in local support, including adding staff and working to open a new lab in China. He also pointed to the company’s patent position, citing more than 7,000 patents globally.
On contract discussions with LG, Millard said the companies have worked together for more than two decades and described the relationship as strong. He said the contract expired at the end of 2025 and that the parties are “working through the details of a new contract,” adding that Universal Display has “no concerns” about putting a new deal in place, though he had “nothing to announce” on the call.
About Universal Display (NASDAQ:OLED)
Universal Display Corporation (NASDAQ: OLED) is a technology company specializing in organic light-emitting diode (OLED) solutions. The company develops and commercializes materials, technologies and software used in the creation of OLED displays and lighting. Its offerings include proprietary phosphorescent OLED (PHOLED) materials, display driver integrated circuits and process technologies that enable higher efficiency, longer lifetimes and improved color performance for a range of display and lighting applications.
Universal Display’s core business is licensing its extensive OLED patent portfolio to display manufacturers and providing them with the key organic materials needed for device fabrication.
