Corning's display business faces dual pressure from declining panel prices and weakening demand

Overview

This report is JPMorgan's display monthly update on CORNING INC (GLW.US), focusing on the transmission of LCD TV panel prices, TV manufacturer demand, and cost pressures to Corning's Display business. The report notes that after a period of stability, panel prices fell broadly in July and are expected to decline further in August; weak consumer demand, rising memory prices, and promotional pressure are together driving TV manufacturers to request panel price cuts and MDF support.

Core views

The core view is cautious. First, TV manufacturers are unable to pass higher supply-chain costs on to end consumers, leading to greater loss pressure, and are buffering rising memory costs by pushing down panel procurement prices. Second, TV manufacturers are shifting production toward larger-size models because memory accounts for a lower share of BOM in larger TVs, but this mix shift may not be sufficient to offset weak end demand. Third, some panel makers may cut utilization rates in 3Q26 to control supply and protect pricing power, which could further weaken panel volumes in 2H26. Fourth, the relatively strong U.S. market performance in 1H26 was mainly promotion-driven and may have pulled forward 2H demand.

Analysis framework

The report mainly uses Omdia panel price tracking data, historical monthly seasonality comparisons, LCD TV panel price changes by size group, and TV manufacturer procurement plans and promotional feedback to conduct a top-down industry read-through analysis of Corning's Display business.

Methodology notes

• Industry price trackingOmdia Panel Price Tracker

  Monthly tracking of LCD TV panel prices

  By comparing actual m/m and y/y price changes in July, expected price changes in August, and historical seasonal averages, the report assesses whether panel price pressure is exceeding normal seasonality.

• Industry chain transmissionread-through analysis

  Transmission of panel prices to Corning's Display business

  Corning produces the glass used in LCD panels, and the Display business contributes an important share of profits; therefore, changes in large-size LCD panel prices, demand, and utilization rates provide a direct read-through for Corning.

• Cost structure analysisBOM pressure analysis

  Impact of memory costs on TV BOM and panel pricing negotiations

  Rising memory prices increase TV BOM, while weak end demand limits TV manufacturers' ability to raise prices, prompting them to seek price cuts and MDF subsidies from panel makers.

Asset mapping & comparison

Structured mapping from thesis to named assets (strengths, weaknesses, peers, risks).

• CORNING INC (GLW.US)

  Covered company; Display business is directly linked to large-size LCD panels

  Strengths

  Corning holds an important position in LCD display glass. LCD still accounts for the vast majority of global viewing area, and TV displays account for more than 70% of LCD area.

  Weaknesses

  The Display business is sensitive to LCD TV panel demand, pricing, and panel maker utilization rates; current panel price declines and pressure from TV manufacturers for lower prices create negative transmission.

  Comparison

  Compared with OLED, LCD still covers about 97% of global viewing area, but LCD TV panel prices have declined y/y for 16 consecutive months, showing price pressure in a mature category.

  Risks

  Weak consumer demand, memory cost inflation, promotion-driven demand pull-forward, 3Q26 panel maker utilization cuts, and uncertainty in TV manufacturers' procurement plans.

• LCD TV panel supply chain

  Upstream/downstream demand transmission chain for Corning's Display business

  Strengths

  If TV manufacturers believe prices have bottomed, restocking could emerge in late 3Q26 or 4Q26.

  Weaknesses

  Broad price declines in July and expected further declines in August indicate that short-term bargaining power is tilted toward TV manufacturers.

  Comparison

  There is usually a seasonal price increase from July to August, but Omdia expects a 2.7% m/m decline in August 2026, significantly weaker than the historical average.

  Risks

  Chinese TV manufacturers have lowered their 3Q26 panel demand forecasts, Korean procurement plans still face downside risk, and promotional outcomes will affect follow-on procurement.

Key data

• July average LCD TV panel price m/m-2.1% m/mJune was flat; historically, the average m/m decline from June to July is about 1.4%.
• July average LCD TV panel price y/y-2.1% y/yThis marked the 16th consecutive month of y/y decline; June was -4.7% y/y and May was -6.0% y/y.
• Omdia August price expectation-2.7% m/mHistorically, the average m/m change from July to August is about +1.4%, indicating expectations are clearly weaker than seasonality.
• LCD TV panel prices below 49 inchesJuly -2.0% m/m, +1.0% y/yJune was flat m/m; historically, the average m/m decline from June to July is 0.6%.
• LCD TV panel prices above 49 inchesJuly -2.1% m/m, -2.8% y/yJune was flat m/m; historically, the average m/m decline from June to July is 1.7%.
• LCD display share of global viewing areaabout 97%, more than 5 billion square feetCorning estimates OLED accounts for about 3%; TV displays account for more than 70% of LCD viewing area.
• RatingNeutralUnder J.P. Morgan's rating definitions, Neutral corresponds to the hold category.
• Price$146.65The report discloses this as the price on 24 Jul 26.
• Latest target price in historical recommendation table$200The 16-Jul-26 entry in the table shows Neutral, price $174.41, and target price $200.

Impact & implications

For Corning, the most direct impact comes from the Display business: falling panel prices and downward revisions to TV manufacturers' procurement plans will pressure revenue and profit expectations across the large-size LCD panel chain. If panel makers lower utilization rates to defend pricing, this may help balance supply and demand in the short term, but it could also lead to weaker panel volume demand. From an investment perspective, the report maintains a Neutral framework and indicates that 2H26 risks stem more from demand having been pulled forward by 1H26 promotions, weak consumer demand, and the inability to pass supply-chain costs through smoothly.

Risks

• Consumer demand remains weak, making it difficult for TV manufacturers to pass supply-chain costs on through end-price increases.
• Rising memory prices are increasing TV BOM, causing TV manufacturers to push panel procurement prices lower or request MDF support.
• Promotions in 1H26 may have pulled forward 2H26 demand, creating second-half volume pressure.
• If panel makers reduce utilization rates in 3Q26, this may support prices but suppress panel shipment volumes.
• Chinese TV manufacturers have already lowered 3Q26 panel demand forecasts, and Korean procurement plans still face downside revision risk.
• The timing of a panel price bottom and restocking remains uncertain, and procurement plans depend on promotional outcomes.

What to watch

• Whether LCD TV panel prices in August continue to decline 2.7% m/m as Omdia expects.
• Whether panel makers actually reduce utilization rates in 3Q26 and by how much.
• Changes in TV manufacturers' procurement plans for large-size and ultra-large-size panels.
• Whether post-promotion demand in the U.S. market weakens, and whether 1H26 promotions pulled forward 2H26 demand.
• Whether restocking emerges in late 3Q26 or 4Q26 on expectations that prices have bottomed.
• Changes in Corning's Display business profit, shipment volume, and pricing assumptions in subsequent earnings reports.