8-K

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 22, 2024

UNIVERSAL DISPLAY CORPORATION

(Exact name of Registrant as Specified in Its Charter)

Pennsylvania	1-12031	23-2372688
(State or Other Jurisdiction of Incorporation)	(Commission File Number)	(IRS Employer Identification No.)
250 Phillips Boulevard, Ewing, NJ		08618
(Address of Principal Executive Offices)		(Zip Code)

Registrant’s Telephone Number, Including Area Code: (609) 671-0980

Not Applicable

(Former Name or Former Address, if Changed Since Last Report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instructions A.2. below):

☐	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)
☐	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)
☐	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))
☐	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, $0.01 par value	OLED	The NASDAQ Stock Market LLC

Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company ☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Item 2.02 Results of Operations and Financial Condition.

On February 22, 2024, Universal Display Corporation (the "Company") issued a press release regarding its financial results for the quarter and year ended December 31, 2023. A copy of the press release is furnished as Exhibit 99.1 to this report.

The information set forth under this “Item 2.02. Results of Operations and Financial Condition” (including the exhibit) shall not be deemed to be “filed” for the purposes of Section 18 of the Securities Exchange Act of 1934, as amended, nor shall it be incorporated by reference in any filing made by the Company pursuant to the Securities Act of 1933, as amended, other than to the extent that such filing incorporates by reference any or all of such information by express reference thereto.

Item 9.01 Financial Statements and Exhibits.

(d) Exhibits

Exhibit Number	Description
99.1	Press Release by the Registrant, dated February 22, 2024, furnished pursuant to Item 2.02 of Form 8-K.
104	Cover Page Interactive Data File (embedded within the Inline XBRL document).

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

	UNIVERSAL DISPLAY CORPORATION
Date: February 22, 2024	By:	/s/ Brian Millard
		Brian Millard
		Vice President, Chief Financial Officer and Treasurer

EX-99.1

Exhibit 99.1

  Press Release

Universal Display Contact:

Darice Liu

investor@oled.com

media@oled.com

+1 609-964-5123

Universal Display Corporation Announces Fourth Quarter and Full Year 2023 Financial Results

EWING, N.J. – February 22, 2024 –Universal Display Corporation (Nasdaq: OLED), enabling energy-efficient displays and lighting with its UniversalPHOLED® technology and materials, today reported financial results for the fourth quarter and full year ended December 31, 2023.

“In 2023, we achieved key milestones, strengthened our capabilities and infrastructure, and positioned the Company for growth in the years ahead,” said Brian Millard, Vice President and Chief Financial Officer of Universal Display Corporation. “Looking to 2024 and beyond, we see multiple paths for growth in the coming years. The commencement of an OLED IT adoption cycle, the resumption of OLED TV growth, the rise of automotive OLED displays, and the popularity of foldable OLED mobile applications all create promising opportunities for substantial growth. In addition to the growing OLED market, we are advancing and broadening our R&D roadmap, which includes novel phosphorescent materials and architectures, as well as our OVJP manufacturing platform.”

Financial Highlights for the Fourth Quarter of 2023

•Total revenue in the fourth quarter of 2023 was $158.3 million as compared to $169.0 million in the fourth quarter of 2022.

•Revenue from material sales was $82.2 million in the fourth quarter of 2023 as compared to $88.3 million in the fourth quarter of 2022. The decrease in material sales was primarily the result of a decrease in the cumulative catch-up adjustments between periods, partially offset by higher sales volume of our emitter material.

•Revenue from royalty and license fees was $72.9 million in the fourth quarter of 2023 as compared to $75.6 million in the fourth quarter of 2022. The decrease in royalty and license fees was primarily the result of changes in customer mix.

•Cost of material sales was $33.4 million in the fourth quarter of 2023 as compared to $26.6 million in the fourth quarter of 2022. This was primarily due to an increase in the volume of material sales and increased contract manufacturing support costs.

•Total gross margin was 77% in the fourth quarter of 2023 as compared to 82% in the fourth quarter of 2022.

•Operating income was $64.7 million in the fourth quarter of 2023 as compared to $83.1 million in the fourth quarter of 2022.

•The effective income tax rate was 18.0% and 19.2% for the fourth quarters of 2023 and 2022, respectively.

•Net income was $62.0 million or $1.29 per diluted share in the fourth quarter of 2023 as compared to $65.1 million or $1.36 per diluted share in the fourth quarter of 2022.

Revenue Comparison

($ in thousands)	Three Months Ended December 31,
	2023		2022
Material sales	$	82,240	$	88,339
Royalty and license fees		72,865		75,585
Contract research services		3,215		5,108
Total revenue	$	158,320	$	169,032

Cost of Materials Comparison

($ in thousands)	Three Months Ended December 31,
	2023			2022
Material sales	$	82,240		$	88,339
Cost of material sales		33,379			26,603
Gross margin on material sales		48,861			61,736
Gross margin as a % of material sales		59	%		70	%

Financial Highlights for the Full Year 2023

•Total revenue in the full year 2023 was $576.4 million as compared to $616.6 million in the full year 2022.

•Revenue from material sales was $322.0 million in the full year 2023 as compared to $331.1 million in the full year 2022. The decline in material sales was primarily due to a decrease in the cumulative catch-up adjustments between periods, partially offset by higher blue emitter and host sales.

•Revenue from royalty and license fees was $238.4 million in the full year 2023 as compared to $267.1 million in the full year 2022. The decrease in royalty and license fees was primarily the result of higher estimated future demand for several of our customers over the remaining lives of their contracts, as well as a net $19.7 million reduction in revenue due to the difference in cumulative catch-up adjustments between periods, the majority of which was recorded to royalty and license fees.

•Cost of material sales was $123.1 million in the full year 2023 as compared to $115.6 million in the full year 2022. Cost of material sales increased primarily due to costs associated with our manufacturing facility in Shannon, Ireland which commenced manufacturing in mid-2022, increased inventory reserves and changes in product mix.

•Total gross margin was 77% in the full year 2023 as compared to 79% in the full year 2022. Increases in Shannon facility costs of $5.1 million and inventory reserves of $4.9 million in 2023 contributed to the 2% decrease in total gross margin between periods.

•Operating income was $217.2 million in the full year 2023 as compared to $267.1 million in the full year 2022.

•The effective income tax rate was 17.2% and 21.7% in the full years 2023 and 2022, respectively.

•Net income was $203.0 million or $4.24 per diluted share in the full year 2023 compared to $210.1 million or $4.40 per diluted share in the full year 2022.

Revenue Comparison

($ in thousands)	Year Ended December 31,
	2023		2022
Material sales	$	322,029	$	331,081
Royalty and license fees		238,389		267,115
Contract research services		16,011		18,423
Total revenue	$	576,429	$	616,619

Cost of Materials Comparison

($ in thousands)	Year Ended December 31,
	2023			2022
Material sales	$	322,029		$	331,081
Cost of material sales		123,076			115,602
Gross margin on material sales		198,953			215,479
Gross margin as a % of material sales		62	%		65	%

2024 Guidance

The Company believes that its 2024 revenue will be in the range of $625 million to $675 million. The OLED industry remains at a stage where many variables can have a material impact on results, and the Company thus caveats its financial guidance accordingly.

Dividend

The Company also announced a first quarter cash dividend of $0.40 per share on the Company’s common stock. The dividend is payable on March 29, 2024 to all shareholders of record as of the close of business on March 15, 2024.

Conference Call Information

In conjunction with this release, Universal Display will host a conference call on Thursday, February 22, 2024 at 5:00 p.m. Eastern Time. The live webcast of the conference call can be accessed under the events page of the Company's Investor Relations website at ir.oled.com. Those wishing to participate in the live call should dial 1-877-524-8416 (toll-free) or 1-412-902-1028. Please dial in 5-10 minutes prior to the scheduled conference call time. An online archive of the webcast will be available within two hours of the conclusion of the call.

About Universal Display Corporation

Universal Display Corporation (Nasdaq: OLED) is a leader in the research, development and commercialization of organic light emitting diode (OLED) technologies and materials for use in display and solid-state lighting applications. Founded in 1994 and with subsidiaries and offices around the world, the Company currently owns, exclusively licenses or has the sole right to sublicense more than 6,000 patents issued and pending worldwide. Universal Display licenses its proprietary technologies, including its breakthrough high-efficiency UniversalPHOLED® phosphorescent OLED technology that can enable the development of energy-efficient and eco-friendly displays and solid-state lighting. The Company also develops and offers high-quality, state-of-the-art UniversalPHOLED materials that are recognized as key ingredients in the fabrication of OLEDs with peak performance. In addition, Universal Display delivers innovative and customized solutions to its clients and partners through technology transfer, collaborative technology development and on-site training. To learn more about Universal Display Corporation, please visit https://oled.com/.

Universal Display Corporation and the Universal Display Corporation logo are trademarks or registered trademarks of Universal Display Corporation. All other Company, brand or product names may be trademarks or registered trademarks.

# # #

All statements in this document that are not historical, such as those relating to the projected adoption, development and advancement of the Company’s technologies, and the Company’s expected results, as well as the growth of the OLED market and the Company’s opportunities in that market, are forward-looking financial statements within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking statements in this document, as they reflect Universal Display Corporation’s current views with respect to future events and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated. These risks and uncertainties are discussed in greater detail in Universal Display Corporation’s periodic reports on Form 10-K and Form 10-Q filed with the Securities and Exchange Commission, including, in particular, the section entitled “Risk Factors” in Universal Display Corporation’s Annual Report on Form 10-K for the year ended December 31, 2023. Universal Display Corporation disclaims any obligation to update any forward-looking statement contained in this document.

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UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES

CONSOLIDATED BALANCE SHEETS

(in thousands, except share and per share data)

	December 31, 2023			December 31, 2022
ASSETS
CURRENT ASSETS:
Cash and cash equivalents	$	91,985		$	93,430
Short-term investments		422,137			484,345
Accounts receivable		139,850			92,664
Inventory		175,795			183,220
Other current assets		87,365			45,791
Total current assets		917,132			899,450
PROPERTY AND EQUIPMENT, net of accumulated depreciation of $143,908 and $117,118		175,150			143,445
ACQUIRED TECHNOLOGY, net of accumulated amortization of $186,850 and $189,671		90,325			38,382
OTHER INTANGIBLE ASSETS, net of accumulated amortization of $10,414 and $8,989		6,874			8,247
GOODWILL		15,535			15,535
INVESTMENTS		299,548			259,861
DEFERRED INCOME TAXES		59,108			58,161
OTHER ASSETS		105,289			109,739
TOTAL ASSETS	$	1,668,961		$	1,532,820
LIABILITIES AND SHAREHOLDERS’ EQUITY
CURRENT LIABILITIES:
Accounts payable	$	10,933		$	9,519
Accrued expenses		52,080			51,002
Deferred revenue		47,713			45,599
Other current liabilities		8,096			29,577
Total current liabilities		118,822			135,697
DEFERRED REVENUE		12,006			18,279
RETIREMENT PLAN BENEFIT LIABILITY		52,249			59,790
OTHER LIABILITIES		38,658			43,685
Total liabilities		221,735			257,451
SHAREHOLDERS’ EQUITY:
Preferred Stock, par value $0.01 per share, 5,000,000 shares authorized, 200,000    shares of Series A Nonconvertible Preferred Stock issued and outstanding    (liquidation value of $7.50 per share or $1,500)		2			2
Common Stock, par value $0.01 per share, 200,000,000 shares authorized, 48,731,026    and 49,136,030 shares issued, and 47,365,378 and 47,770,382 shares outstanding at    December 31, 2023 and December 31, 2022, respectively		487			491
Additional paid-in capital		699,554			681,335
Retained earnings		789,553			653,277
Accumulated other comprehensive loss		(1,086	)		(18,452	)
Treasury stock, at cost (1,365,648 shares at December 31, 2023 and December 31, 2022)		(41,284	)		(41,284	)
Total shareholders’ equity		1,447,226			1,275,369
TOTAL LIABILITIES AND SHAREHOLDERS’ EQUITY	$	1,668,961		$	1,532,820

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF INCOME

(in thousands, except share and per share data)

	Three Months Ended December 31,						Twelve Months Ended December 31,
	2023			2022			2023			2022
REVENUE:	(Unaudited)
Material sales	$	82,240		$	88,339		$	322,029		$	331,081
Royalty and license fees		72,865			75,585			238,389			267,115
Contract research services		3,215			5,108			16,011			18,423
Total revenue		158,320			169,032			576,429			616,619
COST OF SALES		36,019			30,098			135,376			127,896
Gross margin		122,301			138,934			441,053			488,723
OPERATING EXPENSES:
Research and development		33,641			31,906			130,481			117,062
Selling, general and administrative		16,830			18,513			67,387			77,886
Amortization of acquired technology and other intangible assets		4,551			2,897			15,993			17,459
Patent costs		2,300			2,254			9,356			8,329
Royalty and license expense		233			281			647			877
Total operating expenses		57,555			55,851			223,864			221,613
OPERATING INCOME		64,746			83,083			217,189			267,110
Interest income, net		7,865			3,505			28,166			7,811
Other income (loss), net		2,996			(5,942	)		(184	)		(6,691	)
Interest and other income (loss), net		10,861			(2,437	)		27,982			1,120
INCOME BEFORE INCOME TAXES		75,607			80,646			245,171			268,230
INCOME TAX EXPENSE		(13,629	)		(15,512	)		(42,160	)		(58,169	)
NET INCOME	$	61,978		$	65,134		$	203,011		$	210,061
NET INCOME PER COMMON SHARE:
BASIC	$	1.30		$	1.37		$	4.25		$	4.41
DILUTED	$	1.29		$	1.36		$	4.24		$	4.40
WEIGHTED AVERAGE SHARES USED IN COMPUTING NET    INCOME PER COMMON SHARE:
BASIC		47,571,382			47,402,007			47,559,669			47,390,352
DILUTED		47,657,854			47,492,560			47,622,763			47,468,507
CASH DIVIDEND DECLARED PER COMMON SHARE	$	0.35		$	0.30		$	1.40		$	1.20

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES

CONSOLIDATED STATEMENTS OF CASH FLOWS

(in thousands)

	Year Ended December 31,
	2023			2022
CASH FLOWS FROM OPERATING ACTIVITIES:
Net income	$	203,011			210,061
Adjustments to reconcile net income to net cash provided by operating activities:
Depreciation		27,409			24,815
Amortization of intangibles		15,993			17,459
Amortization of premium and discount on investments, net		(11,603	)		(6,461	)
Impairment of minority investments		—			6,962
Stock-based compensation to employees		22,335			28,380
Stock-based compensation to Board of Directors and Scientific Advisory Board		1,774			1,566
Deferred income tax benefit		(3,766	)		(26,946	)
Retirement plan expense, net of benefit payments		3,129			5,276
Decrease (increase) in assets:
Accounts receivable		(47,186	)		14,975
Inventory		7,425			(49,060	)
Other current assets		(41,574	)		(24,843	)
Other assets		4,450			25,971
Increase (decrease) in liabilities:
Accounts payable and accrued expenses		4,047			3,338
Other current liabilities		(21,481	)		20,917
Deferred revenue		(4,159	)		(93,203	)
Other liabilities		(5,027	)		(32,392	)
Net cash provided by operating activities		154,777			126,815
CASH FLOWS FROM INVESTING ACTIVITIES:
Purchases of property and equipment		(59,792	)		(42,497	)
Purchase of intangibles		(66,563	)		(4,709	)
Purchases of investments		(531,103	)		(701,993	)
Proceeds from sale and maturity of investments		574,165			468,456
Net cash used in investing activities		(83,293	)		(280,743	)
CASH FLOWS FROM FINANCING ACTIVITIES:
Proceeds from issuance of common stock		2,012			1,570
Payment of withholding taxes related to stock-based compensation to employees		(8,206	)		(9,209	)
Cash dividends paid		(66,735	)		(56,996	)
Net cash used in financing activities		(72,929	)		(64,635	)
DECREASE IN CASH AND CASH EQUIVALENTS		(1,445	)		(218,563	)
CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR		93,430			311,993
CASH AND CASH EQUIVALENTS, END OF YEAR	$	91,985		$	93,430
The following non-cash activities occurred:
Unrealized loss on available-for-sale securities	$	(8,938	)	$	(8,100	)
Common stock issued to Board of Directors and Scientific Advisory Board    that was earned and accrued for in a previous period		300			300
Net change in accounts payable and accrued expenses related to purchases    of property and equipment		678			3,069
Cash paid for income taxes, net of refunds		96,176			72,347

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Document And Entity Information	Feb. 22, 2024
Cover [Abstract]
Document Type	8-K
Amendment Flag	false
Document Period End Date	Feb. 22, 2024
Entity Registrant Name	UNIVERSAL DISPLAY CORPORATION
Entity Central Index Key	0001005284
Entity Emerging Growth Company	false
Title of 12(b) Security	Common Stock, $0.01 par value
Trading Symbol	OLED
Security Exchange Name	NASDAQ
Entity File Number	1-12031
Entity Incorporation, State or Country Code	PA
Entity Tax Identification Number	23-2372688
Entity Address, Address Line One	250 Phillips Boulevard
Entity Address, City or Town	Ewing
Entity Address, State or Province	NJ
Entity Address, Postal Zip Code	08618
City Area Code	609
Local Phone Number	671-0980
Written Communications	false
Soliciting Material	false
Pre-commencement Tender Offer	false
Pre-commencement Issuer Tender Offer	false