Profile: AU Optronics Corp. (AUO)

AU Optronics Corp., incorporated in 1996, designs, develops, manufactures, assembles and markets flat panel displays. The Company's principal products are thin-film transistor-liquid crystal display (TFT-LCD) panels. Its panels are used in computer products, such as notebook computers and desktop monitors; consumer electronics products, such as mobile phones, digital photo frames, digital still cameras, portable navigation display, portable digital video disc (DVD) players, LCD televisions, and industrial displays. The Company sells its panels primarily to original equipment manufacturing service providers or brand customers. As of December 31, 2008, it manufactured TFT-LCD at fabrication facilities commonly known as fabs. The Company groups its business into three marketing channels: Information Technology Displays, Consumer Products Displays and Television Displays. The Information Technology Displays Business Group covers applications, such as desktop and notebook computers. The Consumer Products Displays Business Group covers applications, such as audio-video displays and mobile device displays. The Television Displays Business Group covers applications, such as LCD television. In September 2009, the Company divested its entire interest in United Microelectronics Corporation.

In March and June 2008, the Company acquired 45% and 26% of equity interests in Verticil Electronic Corp. and Dazzo Technology Corporation, respectively. In January 2009, the Company established its wholly owned subsidiary, AU Optronics (Slovakia) s.r.o. in Slovakia, which is engaged in the assembly of TFT-LCD modules and manufacture and sale of related parts. In February 2009, it established wholly owned subsidiary, BriView Electronics Corp. in the People’s Republic of China, which is engaged in the manufacture and sale of liquid crystal products and related parts.

Computer Products

During the year ended December 31, 2008, sales of panels for notebook computers accounted for 19.1% of the Company’s net sales. Its product mix for notebook computers primarily includes 8.9- to 17-inch panels. The most commonly produced panel sizes for notebook computers have been 14.1, 15.4 and 15.6 inches. During 2008, sales of panels for desktop monitors accounted for 22% of its net sales. In 2008, 17-inch, 19-inch and 20.1-inch panels were most commonly produced for desktop monitors.

Consumer Electronics Products

The Company’s panels for consumer electronics products are used in products, such as mobile phones, digital photo frames, digital still cameras, portable navigation display, portable DVD players, digital camcorders, automobile display, amusement and printer displays. During 2008, sales of panels for consumer electronics accounted for 10% of its net sales.

Liquid Crystal Display Television

The Company's panels for LCD television consist of panels with a panel size of 19 inches or above. Its portfolio of LCD television panels consists of 19-inch to 65-inch panels. In 2008, sales of LCD television panels accounted for 44.4% of the Company’s net sales. In 2008, approximately 70% LCD television panels produced by the Company were 30-inches and above.

Industrial Display

The Company’s panels for industrial display are used in products, such as automatic teller machines, point of sale systems, kiosks, industrial PCs, marine and aviation electronics, game machines, medical equipment, factory automation systems, e-Signage and public information displays. In 2008, sales of panels for industrial display accounted for 3.2% of its net sales.

The Company competes with LG Display Co., Ltd., Samsung, Chi Mei Optoelectronics, Chunghwa Picture Tubes, Hannstar Display, Innolux Display, Toppoly Optoelectronics, Wintek Corporation, Giantplus Technology, Prime View International Co., Ltd., Sharp, Toshiba Matsushita Display Technology, IPS Alpha Technology, Ltd., Tottori Sanyo, Shanghai SVA NEC Liquid Crystal Display Co., Ltd., BOE Technology Group Co., Ltd., IVO Corporation, Century Corporation Co., Ltd. China, Shanghai Tianma Micro Electronics Co., Ltd., and Shenzhen Tianma Micro Electronics Co., Ltd.