Clearing the Decks
Now that Samsung Electronics (005930.KS) has begun offering its 2022 line of Mini-LED/QD and QD only TVs (or at least in part), we can look at how TV set pricing has progressed with last year’s models and how the new line’s pricing compares with 2021 pricing. We note that while this is a microcosm of the TV space, it is at least a representation of how companies adjust TV set prices, particularly in the premium category and how seasonality and other factors affect that pricing. The 2022 Mini-LED/QD and QD only line is essentially the same as the 2021 line other than the elimination of the 70A (2021) class, which consisted of four sizes of 4K Quantum Dot TVs. Given that the series above (80A) and below (60A) duplicated all of those sizes and provided almost the same combination of features at similar prices, we expect Samsung saw no need to bring back that line.
When Samsung began to accumulate TV panels for the Mini-LED/QD line last year TV panel prices were on the rise (Figure 1), while this year TV panel prices had fallen considerably from the highs reached in July of last year. Based on February Aggregate TV panel pricing, TV panels acquired in February 2022 were 38.8% lower in price than during the same period last year, while offsets would be rising component, silicon, and transportation costs, but Samsung has lowered the initial price of this year’s models by only 6.7%, with the bulk of the reductions in the lower price tier Mini-LED/QD line (85 Series) and the higher prices QD only line (80 Series). Due to the potential for feature changes and potential cost offsets mentioned above in the 2022 line, it is difficult to understand exactly how much of the panel cost savings Samsung has passed on to consumers, at least as part of initial 2022 pricing, but we assume they continue to capture considerably more margin on this line than on the more generic standard LCD TV line. We expect also that Mini-LED backlight costs are lower on a y/y basis as the number of suppliers has increased.
Based on the rate of change data (Figure 1) for the entire line, we expect to see price reductions as soon as the end of May, with the biggest price drops in June/July (summer sales), for Columbus Day in October and the Thanksgiving Holiday. That said, the single largest overall price decline came in February of this year, usually due to a push to reduce previous year inventory as new models go into production. The worst time to buy, at least from this sample, is right before Christmas, as desperate gift buyers tend to be more willing to pay a premium as time runs out, and similarly just before Chinese New Year, likely for the same reason. Most significant however, is the fact that in the 328 days since the 2021 line became available the aggregated price of the entire line has decreased by 29.6% from initial prices, and 27 of the 35 models are currently at their lowest price point (one is at its highest), and across the top of the line (900 Series), which are 8K Mini-LED/QD sets, that group is down 46.7% from its initial pricing.
Based on the rate of change data (Figure 1) for the entire line, we expect to see price reductions as soon as the end of May, with the biggest price drops in June/July (summer sales), for Columbus Day in October and the Thanksgiving Holiday. That said, the single largest overall price decline came in February of this year, usually due to a push to reduce previous year inventory as new models go into production. The worst time to buy, at least from this sample, is right before Christmas, as desperate gift buyers tend to be more willing to pay a premium as time runs out, and similarly just before Chinese New Year, likely for the same reason. Most significant however, is the fact that in the 328 days since the 2021 line became available the aggregated price of the entire line has decreased by 29.6% from initial prices, and 27 of the 35 models are currently at their lowest price point (one is at its highest), and across the top of the line (900 Series), which are 8K Mini-LED/QD sets, that group is down 46.7% from its initial pricing.
Aggregate TV Panel Pricing & ROC - 2019 - 2022 - Source: SCMR LLC, IHS, Company Data
- Samsung Mini-LED & QD Only 4K/8K TV Line ROC - Source: SCMR LLC, Company Data
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