Philips Falls To Third In LCD-TV Sales Following Poor Performance - InformationWeek

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Philips Falls To Third In LCD-TV Sales Following Poor Performance

Philips saw its market share in terms of shipments drop to 12.2%, which let Sony take over the No. 2 spot.

The first three months after the busy holiday shopping season is always slow for LCD TV makers, but the first quarter was particularly hard for Philips Electronics, which fell to third place in the market with the worst performance of the top five vendors, a market research firm said.

Philips suffered a 26% slide in sales in the first quarter, more than three times the overall drop in the market, iSuppli said. Overall, shipments of televisions with liquid crystal displays fell 8% worldwide from the fourth quarter of 2006 to 15.2 million units.

Philips saw its market share in terms of shipments drop to 12.2% from 15.1%. As a result, Sony toppled the vendor from the No. 2 spot, despite a 13.7% decline in sales for Sony.

Philips' poor performance was linked to its lack of direct control over the supply of its LCD panels, iSuppli analyst Andrew Murray said in a statement. "The company clearly has a close relationship with panel supplier LG.Philips LCD Co. Ltd. -- but it doesn't have total control, making it hard to get the favorable delivery and pricing terms enjoyed by some of its competitors," he said. L.G.Philips is the largest maker of LCD screens that go into TV sets and computer monitors.

No. 1 Samsung, on the other hand, has good control over its product costs, and runs very aggressive marketing campaigns, Murray said. Samsung outperformed the market as a whole with a 7.3% sequential decline in shipments to 2.4 million units. The company's market share rose slightly to 16.8% from 16.7%. Rounding out the top five vendors were Sharp, which had an 11.3% share; and LG Electronics, 7.8%.

In the first month of the second quarter, LCD-TV sales apparently looked brighter. The NPD Group said that retail revenue from LCD TVs in April rose 80% from the same month a year ago to more than $400 million. Overall TV revenue year to year fell 3%, with every category showing a decline except LCD TVs.

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