Display driver IC demand is forecast to grow by 3% YoY in 2023

After surging growth in the past two years, the DDIC market is facing a sharp decline in 2022. According to Omdia’s latest forecast in Display Driver IC Market Tracker, the total demand forecast for DDIC in 2022 is expected to decrease by 12% YoY, reaching 7.8 billion units. Demand for all the main applications is declining this year, including notebook PCs, monitors, tablets, LCD TVs, and smartphones. Large-sized DDIC demand, which accounts for 70% of total DDIC demand, will decline by 12% YoY, of which LCD TV demand will decline by 12%. In the small and medium-sized DDIC category, smartphone demand (including both LCD and AMOLED displays) is forecast to decrease by 17%, and the overall demand for small and medium-sized DDIC will decline by 12% YoY.

DDIC makers released their 3Q22 investor relations reports recently. Owing to the impact of the sharp decline in consumer demand, revenue in 3Q22 for almost all IC design houses declined by double digits quarter-over-quarter (QoQ), and gross margins even showed a significant decline of more than 4 percentage points QoQ. Inventory for DDIC makers reached a peak in 3Q22 because of weak demand and long-term agreement (LTA) constraints. DDIC makers did not reduce the start of production of new wafers until 2Q22, but all the new wafers introduced in 1Q22 and 2Q22 saw production end in 3Q22 and 4Q22.

1. Figure 1: DDIC yearly demand forecast

Source: Omdia

DDIC demand forecast in 2023: Increase by 3% YoY

Because of weak demand for AMOLED smartphones and smartwatch DDICs, which accounts for more than 70% of total AMOLED DDIC demand, Omdia forecasts AMOLED DDIC demand in 2022 will also decline. However, thanks to the DDIC demand growth for OLED TVs, OLED smartphones, and OLED smartwatches in 2023, as well as the continuously rising penetration of OLED DDICs in emerging applications (like gaming, monitor, notebook PC, tablet, and automotive products), the AMOLED DDIC demand in 2023 is expected to grow by 14% YoY.

In the LCD segment, although LCD TV panel unit shipment in 2023 will still keep going down, larger sizes and higher resolution will drive LCD TV DDIC demand to grow by 8% in 2023. The total demand for LCD DDIC in 2023 is expected to grow by 1%.

Automotive DDICs will also drive the DDIC demand growth in 2023, in which instrument clusters and center stack displays account for 80% of the total demand. In 2023, automotive DDIC demand is forecast to grow by 4% YoY.

Omdia forecasts total DDIC demand in 2023 will grow by 3% YoY, reaching 8.0 billion units.

2. Figure 2: Display driver IC yearly demand forecast by application

Source: Omdia