Overview of LX Semicon Daejeon Campus./Courtesy of News1

LX Group's semiconductor design company LX Semicon is expected to intensify competition with Samsung Electronics' System LSI division, which is the number one player in the DDI market, as it seeks to supply organic light-emitting diode (OLED) display driver chips (DDI) for the Apple iPad Pro. It is known that the DDI, which was first equipped on the iPad Pro last year, was mostly supplied by Samsung Electronics' System LSI division.

According to the industry on the 20th, LX Semicon has entered the OLED DDI supply chain for the Apple iPad Pro. LX Semicon adopted its current name after becoming independent from LG Group in 2021. It has grown by supplying DDIs to LG Display in the past. A DDI is a semiconductor that receives signals from the central processing unit (CPU) of electronic devices and generates output signals to operate the display panel. LX Semicon achieved sales of 1.8656 trillion won and an operating profit of 167.1 billion won last year. Leading the company since the end of 2023 is CEO Lee Yoon-tae, a former CEO of Samsung Electro-Mechanics.

Since last year, LX Semicon has faced urgent diversification of its revenue sources as LG Display has been receiving DDIs from the Taiwanese company Novatech. This analysis suggests that LX Semicon is simultaneously increasing its stake in the Chinese display company BOE while pushing to enter the OLED DDI supply chain for the Apple iPad Pro.

An industry official said, "It is true that there were significant concerns about LX Semicon's performance as LG Display diversified its supply chain," adding, "Although LX Semicon is diversifying its revenue sources into companies like China's BOE, it must prove its competitiveness in the growing IT OLED DDI market to continue improving its performance."

LX Semicon is expected to compete with Samsung Electronics over the supply of OLED DDIs for the iPad Pro. Last year, Samsung Display and LG Display supplied about 6 million OLEDs for the iPad to Apple; however, it is reported that DDI was effectively supplied exclusively by Samsung Electronics. Forecasts suggest that OLED shipments for the iPad this year will increase slightly compared to last year. According to market research institutions, Samsung Electronics holds the top spot in the DDI market with a market share in the 30% range, while LX Semicon holds the third spot with a market share in the mid-to-high 10% range.

As the delivery of OLED DDIs for the iPad Pro becomes more visible, there are projections that it will have a positive impact on LX Semicon's performance. This is because the volume of DDI supply is expected to increase alongside the growing IT OLED market. According to financial information provider FnGuide, LX Semicon's operating profit estimate for this year is 204.4 billion won, which is expected to increase by about 22% compared to last year's 167.1 billion won.

Kang Min-goo, a researcher at IBK Securities, noted, "Although continued IT consumption slowdown is expected to lead to slight revenue decline, there are positive elements for LX Semicon's performance, such as being selected as a supplier for iPad Pro DDIs," and explained, "Apple's adoption of IT OLED is expected to drive market growth, with OLED DDI shipments projected to grow from 1.4 billion this year to about 1.8 billion by 2028."