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This statistic highlights Universal Display’s Revenue by Segment, across Contract Research Services, Material Sales, and Royalty and License fees, reported on a quarterly basis from Q1 2016 onwards.
Universal Display’s Revenue by Segment
|Revenue by Segment||Q3 2020||Q2 2021||Q3 2021||Contribution in Q3 2021|
|Contract research services||$3.82||$4.01||$4.07||2.83%|
|Royalty and license fees||$44.55||$48.21||$63.94||44.52%|
(All figures in millions, except percentages)
The total revenue generated by Universal Display has been increasing every quarter. The revenue increased by 10.77% on a quarter-on-quarter basis, from $129.66 million in Q2 2021 to $143.62 million in Q3 2021. The year-on-year growth was 22.27%, when compared to Q3 2020, where the revenue generated was $117.08 million.
Universal Display’s revenue can be bifurcated into the following segments:
Contract Research Services
This segment generates revenue through contract research services by providing chemical materials synthesis research, development, and commercialization for non-OLED applications. Intermediates for structure-activity relationship investigations, reference agents and building blocks for combinatorial synthesis, re-synthesis of important intermediates, customized organic chemistry needs, and selective toll manufacture are just a few of the services available. Third-party pharmaceutical and life sciences companies, as well as other technology companies, receive these services for a fixed rate or on an annual contract basis.
The revenue generated from this segment has been increasing over the quarters. When compared to Q3 2020, there was a 6.54% year-on-year increase. The revenue increased by 1.50% quarterly, from $4.01 million in Q2 2021 to $4.07 million in Q3 2021. However, the contribution to revenue mix has also been decreasing over the quarters, 3.26% in Q3 2020, 3.09% in Q2 2021, and 2.83% in Q3 2021.
Material sales include the selling of the Company’s OLED materials to clients for use in their commercial OLED products or OLED development and evaluation. Revenue from material sales is normally recognized when the title passes to the buyer, which is usually at the time of shipping or delivery, depending on the contractual arrangement between the parties. If the transaction price involves variable consideration, revenue may be recognized after control of the material has passed.
The total revenue generated from this segment grew by 10.04% yearly, from $68.71 million in Q3 2020 to $75.61 million in Q3 2021. However, when compared to Q2 2021, where the revenue generated was $77.44 million, the decline in revenue was 2.36% on quarterly basis. This segment contributed 52.65% in the latest quarter of 2021. Even though there was a year-on-year increase in revenue generated from the segment, the contribution to revenue fell from 58.69% in Q2 2022.
Royalty and License Fee
Under certain commercial, development, and technology assessment agreements, the company receives license and royalty payments, some of which are non-refundable advances. Royalties and license fees paid under license agreements, as well as license fees included in certain commercial supply agreements, may be included in these payments. These payments are included in the customer’s expected total contract consideration and recognized as revenue during the contract’s term based on material units sold at the projected per-unit fee.
The total revenue generated from this segment has been increasing every quarter. The revenue increased by 32.62% on a quarterly basis, from $48.21 million in Q2 2021 to $63.94 million in Q3 2021. The year-on-year growth was 43.52% when compared to Q3 2020, where the revenue generated was $44.55 million. The contribution also increased from 38.05% in Q3 2020 to 44.52% in Q3 2021.
Universal Display is a pioneer in the development of organic light-emitting diode (OLED) technology and materials for display and solid-state lighting applications. OLEDs are light-emitting solid-state devices that can be made on both, flexible and rigid substrates, making them ideal for use in full-color displays and lighting. OLED displays are gaining market share in a variety of markets, including mobile phones, televisions, wearables, tablets, notebooks, personal computers, augmented reality (AR), virtual reality (VR), portable media devices, and automobiles.
Universal Display’s primary business strategy is to develop new OLED materials and sell existing and any new materials to manufacturers of display products such as mobile phones, televisions, wearables, tablets, portable media devices, notebook computers, personal computers, and automotive applications, as well as specialty and general lighting products; and continue to develop and license proprietary OLED technologies to those manufacturers. The common stock of the company is publicly traded on the NASDAQ under the symbol “OLED”.
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