I just read the transcript from SeekingAlpha which was the source of that article:
http://seekingalpha.com/article/286...t-on-q4-2014-results-earnings-call-transcript
A couple things jumped out at me.
It seems like they are now talking about three lines:
A first line of 8000 sheets per month which is presumably the M1 pilot line -has that been converted to full-sheet production?
A second line of 6000 sheets per month which is presumably the M2 phase I production capacity (earlier was stated to be 8000 sheets per month but sounds like it is only 6000).
So this is the 14,000 sheets per month they currently have available and assuming full-sheets, that translates into 84000 raw 55" OLEDs per month (or 67,000 per month at stated yields of 80%).
Even if we assum they are only going to have that capacity beginning now, it is more than enough for them to manufacture their 600,000 target production this year.
The 'third line' is supposed to add another 20,000 sheets per month before the end of the year. That would mean a total production capacity of 26,000 beyond the 8000-sheet capacity of M1, which has always the target 'fully-ramped' capacity of M2.
Whether it is 2 lines or three lines and what they are called really does not matter one iota.
What matters (at least to me) is first whether M1 is producing 8000 full sheets (meaning it can produce anything being produced on the other lines) or 8000 half-sheets (unlikely since that would mean lower capacity than LGD has represented) or 8000 full-sheets manufactured in half-sheets (meaning M1 can not be used to economically produce 65" OLEDs).
And the second thing that matters to me is that the ramp of M2 is much more tepid than had been expected. Only an additional 6000 sheets per month at the moment (less than a second pilot line) and expected to ramp to full capacity of an additional 20,000 sheets per month beyond that level 'in Q4'.
Sounds to me like LG is hedging their bets and taking one small step at a time. There is not going to be a tsunami of OLEDs as expected this spring but rather a first ramp in an effort to sell in excess of 50,000 OLEDs per month by summer.
If that milestone is reached (and perhaps as little as half that level), the capacity expansion for an additional 20,000 sheets per month is likely. If sales are a fraction of that level by then (certainly if they are in the single-digit thousands by Mid-year), LG may decide to hold off on the additional production capacity investments.
Same plan, just that the numbers are smaller than most had thought and the M1 pilot production line is a central part of the 2015 production plan (over 50%).