- Omdia predicts a 10% quarter-on-quarter drop in small and medium display shipments in 2Q25.
- AMOLED panels maintain a stable 58% market share despite shipment declines.
- Inventory adjustments and eased tariff risks contribute to the shipment downturn.
New analysis from Omdia's quarterly small medium display market tracker forecasts a 10% quarter-on-quarter (QoQ) and 6% year-on-year decline in small and medium display shipments for the second quarter of 2025. This downturn is attributed to continued inventory adjustments by smartwatch and smartphone manufacturers, who had previously stockpiled panels due to tariff concerns in late 2024 and early 2025. However, as tariff risks have reduced, these manufacturers are adopting a more conservative purchasing approach.
In the first quarter of 2025, small and medium display shipments totaled 1,048 million units, with AMOLED panels—frequently used in smartphones and smartwatches—accounting for 612 million units, or 58% of the total market share. The initial growth was largely driven by inventory build-ups in anticipation of tariffs, and high capacity utilization by AMOLED panel producers.
Predictions for 2Q25 indicate a reduction in total shipments to 942 million units, with AMOLED panels comprising 551 million units while maintaining their 58% market share. Notably, the smartphone display sector is projected to suffer a 14% QoQ decline, while smartwatch displays face an 18% drop. In contrast, amusement display shipments are set to more than double, fueled by the release of new mobile gaming consoles.
According to David Hsieh, Senior Director for Display Research at Omdia, the current decline highlights the unique impact of tariff risks and inventory adjustments on the market. Despite the downturn, AMOLED panels have held their market position, putting pressure on LTPS TFT LCD fabs to strategize for long-term sustainability. However, shipments of a-Si TFT LCD panels for entry-level mobile phones have remained stable, encouraging Chinese manufacturers to focus production on these displays in their Gen8.5 and Gen8.6 LCD Fabs.
Omdia anticipates a return to growth in the third quarter of 2025, driven by the diversification of small medium display applications beyond traditional smartphones into broader device categories. As technology evolves, the market expects to see new demands in various applications, further stabilizing and potentially enhancing the market in upcoming quarters.
