Darice Liu – Director, IR Steve Abramson – President and CEO Sid Rosenblatt – EVP and CFO.

Jim Ricchiuti – Needham & Company Osten Bernardez – Cross Research Rob Stone – Cowen and Company Brian Lee – Goldman Sachs Jed Dorsheimer – Canaccord Hendi Susanto – Gabelli Andrew Abrams – SCMR.

Good day ladies and gentlemen, and welcome to Universal Display’s Third Quarter 2014 Earnings Conference Call. My name is Glenn, and I will be your conference moderator for today’s call. As a reminder, this conference is being recorded for replay purposes. I would now like to turn the call over to Darice Liu, Director of Investor Relations.

Please proceed..

Thank you, Glenn. And, good afternoon, everyone. Welcome to Universal Display’s third quarter earnings conference call. Joining me on the call today are Steve Abramson, President and Chief Executive Officer; and Sid Rosenblatt, Executive Vice President and Chief Financial Officer.

Before Steve begins, let me remind you that today’s call is the property of Universal Display. Any redistribution, retransmission or rebroadcast of any portion of this call in any form without the express written consent of Universal Display is strictly prohibited.

Further, this call is being webcast live and will be made available for a period of time on Universal Display’s website. This call contains time-sensitive information that is accurate only as of the date of the live webcast of this call, November 6, 2014.

All statements in this conference call that are not historical are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995, such as those relating to Universal Display Corporation’s technologies and potential applications of those technologies, the company’s expected results, as well as growth of the OLED market, and the company’s opportunities in that market.

These include, but are not limited to, statements regarding Universal Display’s beliefs, expectations, hopes or intentions regarding the future. It is important to note that these statements are subject to risks and uncertainties that could cause Universal Display’s actual results to differ from those projected.

These risks and uncertainties are discussed in the company’s periodic reports filed with the SEC, and should be referenced by anyone considering making any investments in the company’s securities. Universal Display disclaims any obligation to update any of these statements. Now, I would like to turn the call over to Steve Abramson..

Thanks Darice. And welcome to everyone on today’s call. For the third quarter of 2014, we delivered solid results of $32.9 million in revenue, operating profit of $6.1 million and EPS of $0.09 per share. Third quarter results reflected the continued diversification of our customer base and the strength of our business model.

While a million wholesales were lower than anticipated was currently a large end product target segment high-end mobile phones, we did see growth of materials used in large area displays and flexible product offer. Now withstanding the quarter’s softness, we still achieved strong operating profits.

We believe this quarter also go straight the breadth of the OLED market opportunity even in its early stages of technologies option. As one market cycle to temporary product offering gyrations, we have the opportunity to benefit from other aspects of the OLED market.

We’re specifically as one market experiences softness as a result of the inherent cycling of product introductions and consumer demand, such as high-end smartphones. Other market can create positive opportunities such as OLED TVs and flexible, wearable devices.

Broadly speaking, OLED activity in the market continues to revolve and progress and we are uniquely positioned to benefit on the full spectrum of OLED markets opportunities. The number of new OLED products being launched into the marketplace and in the pipeline appear to be same stage for new OLED capacity in 2015 and beyond.

It has been reported that Samsung displays initial of its A3 Gen-6 fab is related to produce flexible OLED products for the capacity start of 15,000 plates per months. This one is anticipated to start operations next year. LG display recently noted on its earnings conference call that it is ramping up its Gen-8 OLED TV production line.

It currently has capacity of 8,000 plates per month and it’s adding an additional 6,000 plates per month by the end of this year. Next year LGD plans to add 20,000 more plates per month bringing the total TV capacity to 34,000 plates per month by the end of 2015.

LGD is also expected to add capacity to its Gen-4.5 line of flexible displays for wearable and comfortable displays. BOE OLED activity continues to advance. The quarter reports the Chinese panel maker is progressing with its Gen-5.5 fab in orders and planning to build the Gen-8.5 OLED TV fab in Hefei.

And just, another week a Chinese news report states that BOE intends to start building a Gen-6 LTPS AMOLED manufacturing line in Chengdu in 2015. As you can see OLED capacity plans are expanding, as or the OLED product roadmaps. To highlight just a few of the recent OLED launches and introductions with our last earnings call.

LG launched a 65-inch 4K OLED TV into the marketplace, Dell announced Venue 87000 tablet top the world’s thinnest tablet at just 6 millimeters thin. On the wearables front, the Samsung Gear S, LG G Watch R and Asus ZenWatch entered the market.

We saw additional product launches in the handset market in both the mid-end and high-end including the Oppo R5, Nokia Lumia 730, Motorola DROID Turbo and Google Nexus 6. Consumers are coming to understand and appreciate and adopt OLED products. Just take Sid and I for example, every morning I need to decide which smartwatch to wear.

My LG G smartwatch R or my Samsung Gear fit. On the larger end of the product spectrum, if you just purchase a 55-inch OLED TV and is loving how vivid and crystal clear the eagles games are especially when they are winning. The proliferation of OLEDs in the marketplace is happening and it is just beginning.

On the OLED solid-state lighting front according to reports our customers LG Cam and Kaneka have developed new OLED panels of longer lifetimes, Konica Minolta is expected to start flexible OLED lighting production and still offers transition OLED lighting from the prototype phase to the product phase.

We are encouraged and excited about the level of commercial and development activity in the OLED display and lighting pipeline. Of course the evolution of the OLED industry is not immune to the usual technology product cycling, but as a whole it is advancing as are we. We are creating new materials with the minerals and ores.

Our new red and green emitters that we’re launching in the beginning of this year have further leveraged our leadership in the market. It kind of well with our design and discovery of next generation emitters, we are developing new host materials.

While our first green host was successfully designed into selective 2013 and 2014 products, there are new product offerings that do not include our green host. Our development teams are working closely with customers, as we invent and commercialize higher performing cost effective next generation emitter and hosting systems.

Another important component to our growth strategy is developing ground breaking technologies that saw significant industry challenges and help advance the OLED market. Let me take a moment to highlight two of our long-term projects, OVJP and single-layer barrier encapsulations. Today OLED they manufactured using a vacuum deposition method.

We have been working on a novel manufacturing printing process called OVJP or Organic Vapor Jet Printing, which allows manufacturers to use a gas stream to print. The same materials are currently being used in existing vacuum deposition systems. This system is being designed for large area panel applications and to lower manufacturing costs.

Additionally, we are working on a single-layer barrier encapsulation solution for plastic substrate. Plastic unlike glass is a porous material that need the barrier to prevent oxygen and moisture from penetrating the display and degrading the OLED.

Our single-layer PECVD Encapsulation system is being designed to provide panel makers a cost effective high throughput tool superior to current encapsulation processes. We believe that these R&D innovations allow us to bolster our global OLED intellectual property framework, while increasing our value proposition in the ecosystem.

These ongoing efforts reinforced our strategic priorities to widen our reach, expand our business and drive profitable long-term growth. Now for a review of our financial results, I’ll turn the call over to Sid..

Thank you, Steve. And again thank you everyone for joining our call today. Let me review our results in more detail before commenting on our 2014 guidance. Revenues for the third quarter of 2014 were $32.9 million flat compared to third quarter 2013.

Revenues for the nine months ended September 30, 2014 were a $134.9 million up 39% over a comparable period in 2013 of $97.2 million. Revenues this year are still on track with strong double-digit year-over-year growth. Total material sales were $27.5 million in the third quarter of which commercial was $24.8 million.

The breakdown of commercial sales by color for the third quarter 2014, prior quarter and the comparable year ago quarters are green emitter sales were $13 million in the third quarter down 13% sequentially from the second quarter of 2014 $15 million and slightly down year-over-year from the comparable quarter $13.6 million.

Green host sales were $5.9 million in the third quarter compared to last quarter’s $10.2 million both of which exclude the Japanese consumption tax and down year-over-year from the comparable quarters $11.2 million.

The reduction in our green host sales is due to our largest customer introducing new product offerings that did not include our host sales. Red emitter sales were $5.1 million in the third quarter, up 16% sequential from the second quarter’s $4.4 million and up year-over-year from the comparable quarter’s $3.4 million.

Our third quarter 2014 royalty and license fees were $5.4 million; this does not include any Samsung license fee, which is $50 million for 2014 half of which is recognized in the second and fourth quarter of the year respectively.

During the quarter, we saw the continuation of our customer diversification trend, direct and indirect sales of our top customer account for 55% of our sales in the quarter. While the second largest customer made up 31% of our sales.

For the first nine months of the year, sales of our top customer indirect and direct accounted for 70% of our sales, while our second largest customer made up 22% of our sales. Moving along to material cost. Material cost for the third quarter were $7.4 million down year-over-year from third quarter 2013, $9.8 million.

Third quarter 2014’s material gross margin were approximately 73% compared to third quarter 2013’s material gross margins of approximately 68%. The improvement in margins is due to product mix and our ongoing cost balance strategy of diligently working to reduce our material cost and boost our competitive position.

Third quarter operating expenses excluding cost of materials were $19.4 million, which was up year-over-year from the comparable quarter’s $18.8 million. Operating income was a solid $6.1 million for the third quarter of 2014, compared to $4.2 million for the third quarter of 2013.

This quarter demonstrates the progress and strength of the operating model we have built through our cost down strategy and ability to manage expenses. Even though sales were flat year-over-year, our operating income was up an impressive 43%.

During the quarter, we incurred income tax expense of $2 million or a tax rate of 31% compared to the recognition of the income tax benefit of $1.1 million in the third quarter of 2013.

As a result, in the third quarter 2014, we reported net income of $4.3 million or $0.09 per share to the comparable quarter in 2013’s $5.5 million or $0.12 per share respectively. Shifting to the balance sheet. We ended Q3 with $268 million in cash and short term investments.

This is down from last quarter’s $291 million mainly due to the outflows for our repurchasing and increasing inventory. Moving to guidance.

Due to the nascent nature of the OLED market and given the current challenges in the high-end smartphone industry and expected volume of host material sales, we now expect 2014 revenues to be approximately $183 million to $185 million.

We continue to be excited about the growing number of OLED products in the marketplace, the OLED display capacity is expected to ramp next year, OLED lighting efforts are accelerating and our customer pipeline is growing. The UDC team continues to do an incredible job of creating and delivering the most innovative technology in the industry.

Bottom-line we have a highly competitive and growing product portfolio to position ourselves for growth well into the future. Now with that, I’ll turn the call back to Steve..

Thanks Sid. At UDC, we are extremely well positioned to compete in markets around the world, based on our leadership as innovator and infrastructure that is designed to drive an effective cost structure and the ability to leverage 20 years of know-how and experience into new materials and technology.

We are scaling our business, targeting new opportunities and driving innovation at the molecular level. These efforts allow us to provide continued value to our customers, while keeping the company at the forefront of the OLED industries. OLED are the next display and lighting revolution.

OLED technology allow display and lighting makers, the capability to radically alter the consumer and illumination landscape to create differentiated, high performing, energy efficient innovative products.

While our near-term results may be subject to certain emerging industry specific fluctuations is by no means indicative of the growing momentum in the OLED ecosystem and our long-term opportunities. Like most growing markets, it will take time for the OLED industry to fully develop and mature.

In summary, we are building a business that sustain attractive growth rates over the long-term consisting of new materials, new technology, new customer agreements and new commercial OLED products. On that note, Glenn, let’s begin the Q&A session..

Thank you. [Operator Instructions]. We’ll take our first question from Jim Ricchiuti with Needham & Company..

Hi, thank you good afternoon..

Hi Jim..

Sid, I wonder if you can just comment little bit more about the issue around the host business and perhaps what the implications are regarding either other devices from that customer, or perhaps how you see that business going forward with other customers? How should we think about the host revenue business?.

Well, as we’ve talked in the past, the host business is a highly competitive commoditized market. We do not expect every recipe of product model to include our host. We’re committed to aggressively pursue high performance cost effective host solutions.

We are implementing cost down strategies while maintaining our lead in the phosphorous and OLED technology. While we do make the best possible material to match our emitters, customers have a choice of host.

Our development teams are working on – they are working on and with customers to deliver next generation host that are higher performing and lower cost. And we are continuing to work diligently to move forward and grow our host business..

Do you guys have a sense of what the design and cycle looks like in terms of as you work on some of these newer materials and, what’s the window like in terms of the next design?.

The window varies, I mean to be honest, it really depends on the customer of how quick they intend to get to next product into the marketplace. It is multiple months; I mean it’s three months, four months or more..

And if I guess one other question, I’ll jump back in the queue.

It looks like your materials business overall with your second largest customer grew fairly nicely, sequentially any color on that, in terms of is this, do you think this is inventory build or is this just a function of the – their coating needs for these larger area displays?.

I can’t specifically say whether its inventory build or whether its production, but we do believe it is going into product, their selling products, their selling them in the marketplace and as Steve stated, they are going to add capacity the end of this year.

So that we are, and then next year they are adding additional capacity, so they are going to grow from 8,000 plates per month up to 34,000 by the end of next year. So that’s a significant growth and we’re very pleased. We’re very obviously large area displays use more material..

Okay, thanks very much..

We’ll take our next question from Osten Bernardez with Cross Research..

Hi yes, good afternoon. Thanks for taking my questions.

So, I just wanted to, I just had a question with respect to the timing in the quarter as to when it became apparent that you would not be able to sort of – to achieve the longer term, the 2014 sales that look that you had previously discussed and sort of, why not sort of one for the quarter, I was just thinking around that?.

As, a number of other in this ecosystem and supply chain, we saw this last quarter get worsen, intensify as the quarter went on. So, we in the beginning, we said on the last call we expected to be soft and I think Samsung even said that on their conference call in Q2 and then Q3 was much worse.

We were always working with the customer and diligent about working and trying to understand what the future would look like. But did intensify during the quarter, and the magnitude that was greater than anybody would have anticipated this quarter..

Okay.

And so, given what you’re seeing from a management standpoint, even for the emitters which should be, even for the emitters and what we’re seeing from a high-end mobile phone standpoint and recent estimates for TVs sort of being, sort of pair back at least for the – in the near future, I guess how do you, how are you thinking about the longer term sort of growth perspective, do you think, I know you, it’s still early, but when we’re thinking about 2015 from the sales growth perspective, should we be, are you assuming that sales growth should be from a material standpoint be, some one or two or better than almost in 2014?.

I mean, we will give guidance for 2015 on our Q4 earnings call. But in 2015, we continue to, we’re going to continue to focus on expanding our customer diversification. We expect the momentum in the OLED market to continue to drive new OLED products and launches and there are new capacity plans.

And so, our guidance for this quarter, obviously we’ve given and it is based upon where we see the market over the next couple of months. In terms of the current market dynamics, I mean we’re confident that the smartphone manufacturers will overcome these temporary fluctuations.

We believe their top customer is leader in the market and in products, in commercialization and we are excited to work with them to continue to do this and we expect them to be successful..

And then going forward, do you anticipate your host business, your host materials sort of being designed and at any point with that largest customer or do you foresee that business sort of no longer returning?.

No we intend to work diligently to get our host business growing. We intend to be in the host business and they are ongoing and we are looking at other customers for our host business. But, we are not giving up on host business at all..

Thank you..

Okay, our next question is from Rob Stone with Cowen and Company..

Hi guys, I wanted to ask about the inventory build and in particular since you were not included in the stack recipe, as you said for some new products, is there ongoing demand at all for green host and do you see the possibility that you have excess inventory?.

Well, I mean we built our inventory to meet our customers’ specifications and needs and, in this case they did not materialize when we have anticipated. We are just in time supplier for our emitters and our host, and we always wanted to ensure that we can meet all of our customer needs. We don’t want to be a bottleneck.

And these materials do have long lead times and they have long shelf life.

And we are going to continue, obviously we need to manage our inventory as anybody else doe, but in the early stages of a new industry there are fluctuations that there is just, to some extent difficult than that is, particularly when you got the supply chain that has long lead items in it..

Okay.

But to be specific there are certain products which you were in the stack recipe that are still shipping, yes?.

That is correct. We still sell host materials, we did sell host materials in Q3 and we will sell host materials in Q4..

Okay, my follow-up question is on the – on the operating expense trend, it looks like you made a fair side of the adjustment sequentially in R&D expense at least, how should we think about your spending plan against this lower revenue trend?.

We still will continue on what we talked about at 10% to 15% increase, this is we believe the temporary lift and we are building this business for the long haul and we think that R&D and developing new and better and higher performing materials is something that we have to do, because we intend to be the leader in this industry for the foreseeable future..

So that speaks to the long term trend, but it looks like you scaled back expenses sequentially in Q3, is that accurate or what was – what you said?.

There are some fluctuations physically in R&D expenses based upon materials that we scale up. We included within that our scale up of new materials within PPG and developmental materials within PPG. And that number does fluctuate from quarter-to-quarter..

So it is likely to then bounce back up in the fourth quarter?.

I would think it would be probably be up over the Q3, yes..

Okay, thank you..

We’ll go next to Brian Lee with Goldman Sachs..

Hey guys, thanks for taking the questions.

I had a couple of them, I guess first half, if I think about, the sequence of events from last quarter to over the past three months and then I try to decompose where the shortfall on guidance is coming from? As there been any incremental price concessions or incremental weakness even off the – the August report that you had in emitters due to Samsung and the smartphone issue that they are having.

When you reiterated the guidance with that in mind, because just trying to figure out if that shortfall is all due to host or if there was also some incremental weakness elsewhere in the portfolio?.

No I mean, the weakness that we saw was in host materials and we’ve seen some overall weakness obviously with Samsung if not pricing issues. There is no significant price declines in the quarter, there is always, negotiations in small part decline, but there was nothing significant..

Okay, so all volume that’s in pricing relative to your outlook from three months ago/.

That’s correct..

And then if I think about your commentary around the next gen green host material development that you’re currently underway in, are you looking at a new gross margin target range for this material segment and is there a margin level that you still view is being sufficient at the low end, if you think about returns and on R&D and investment, just trying to engage whether or not the higher competitive dynamic here that seems to be emerging is going to shift the range of margin targets you’ve thought about on this segment?.

Our margin profile and ranges that we have talked about and that we have used historically. We do not see any change in that. We are working to develop new host that have lower manufacturing cost with higher performance. So, we’re constantly doing that.

So, we still think that there is a margin on materials that is one that is something that fits our model and that makes sense in this industry..

And just if you can reign us was that the – that’s the 40% to 50% range on host specifically gross margin?.

That’s correct. That is correct..

Okay. And then last question from me and I’ll pass it on. On green host again, it sounds like you guys clearly have some amount of intel on which products are using your green host, as supposed to not using your green host, hence being able to attribute the shortfall and guidance specifically to that.

Based on what you know, can you give us some sense of, if you look at the Q3 run rate, what your green host represents as a percent of overall Samsung purchases for that type of material? And then what you might think is reasonable going forward and looking into 2015, if you think this is going to become a multi-sourced material for those specifically?.

As you’re well aware Brian, I can’t speak for Samsung or talk about what they are buying or what they are not buying, I mean we’re in – designs into products in 2013 and 2014 and there are some new products that clearly do not have our host material in them. But we can’t specifically talk product-by-product.

We do believe that there are, they will continue to make some of the other products that we have. So, we continue to expect to sell host however, clearly not at the same level that’s until, we then get designed into the next new product cycle where we would expect them to pick up again..

Okay, thanks a lot guys..

And we’ll take our next question from Jed Dorsheimer with Canaccord..

Hi thanks for taking my question, I guess Sid, maybe just as a follow up, the green emitter business being down 13% to $13 million in this quarter, was that, you had mentioned that that wasn’t pricing related at all.

I’m curious though, do you attribute any of that decline to or how much of that decline do you attribute to your customer being more efficient using the materials?.

What, it’s difficult for us to predict or talk about their efficiency. Clearly across the Board though, because the industry itself and what has been reported by Samsung themselves, they had inventory at the end of June, at the end of their quarter and they clearly were not building as much product in Q3.

So, I would have to say that is based upon the headwinds in the industry..

Okay.

And then I know you’re not getting 2015 guidance, just at a higher level though do you think that 2015 will be the majority of any growth that you should expect would be coming from the display industry or do you see how important do you see lighting becoming in terms of your business?.

As we mentioned earlier, we will give 2015 guidance at our year end call. The lighting industry is growing, the lighting industry was only made up approximately 5% of our revenues and it is still going to be in early stages I believe in 2015.

I think you will see some growth there are a number of players that have pilot lines and introducing pilot products as Steve had said, but I don’t see any real capacity in 2015..

Thanks. And then last question just with respect to the Fujifilm pattern portfolio that you purchased.

Are you able to or have you been leveraging that at all, is that monetizing any licensing or royalty dollars, this point is that incremental I guess to the – the portfolio that you had at the time?.

Specifically to pick one pattern and is that, we say is incremental, we are – it has helped us in developing new materials, our new next gen materials are using some of that IP. And there is IP in there that is very young and we believe we will be able to use that to extend our IP franchise..

Great, thank you..

Thank you..

And we’ll go next to Hendi Susanto with Gabelli..

Good evening Steve and Sid, and thank you for taking my questions. In the green host material business, it’s the nature of design adoption either winning all or nothing.

If I understood that correctly, the lower green host sales is due to customers choosing another vendor, should we expect your customers to prefer single sourcing and host materials and not multi-sourcing?.

I’m not sure whether I can speak for Samsung whether they are multi-sourcing or not. I mean, we clearly that there is another company host material was selected for certain products. We believe that our host material that is selected that they keep a recipe once they start it.

But, I really can’t speak for whether they can or will or are multi-sourcing..

And then in light of the green host situation in Q3, do you anticipate that Samsung may have access in front our inventory build?.

They have been buying it, they bought it during the quarter at regular intervals and I would expect them to continue to buy it at regular intervals. I mean we have been a just in time supplier and the inventory purchases are pretty consistent..

Got it and if I may squeeze one more.

Your second largest customers generated about $10 million in Q3 and it is ramping up in OLED TV production, it is reasonable to think that the $10 million run rate can be the run rate for the next two to three quarters?.

It’s difficult for us to predict at this time, I mean assuming that they are going to be making the same quantity of product, it should be in that ballpark. But it’s – I can’t predict, we’ve given our guidance what we think it will be for this quarter and beyond that, we’ll talk about that when we give our 2015 guidance..

Okay, thank you..

And we’ll go next to Andrew Abrams with SCMR..

Hi guys, I don’t want to beat a dead horse, but one question on green host.

If you had to characterize, what you would expect the difference between your host material and the other host material that’s being used, would it be a matter of, you are being hard on price relative to the other manufacturer meaning, if they get 90% of what they get from your material in terms of performance, but a considerably lower price from that vendor.

Would you see that as the difference in what’s get designed in and if that’s the case or if it’s not the case would you expect the lower end products to be using that green host in certain circumstance, because of the cost of your material relative to someone else? I know that’s a lot..

Well as we’ve said, it’s a pricing performance material and the customer, obviously have to make his own decisions we don’t know what the characteristics or the performance or actually the price of the competitors materials are, we don’t get their materials, so I can’t really compare it.

Clearly we hear from our customer and they tell us different things about it. So, I honestly can’t answer your question, we know that we have targets of where we want to be and you know they give us targets and we’re doing our best to develop the best material at the best price to win the business..

Got it, okay.

To red, you did better on red was it a mix issue with more red to then in the previous quarter or was just general demand higher than it was in the previous quarter?.

It is, it’s two fold, it is the new red emitters have a higher ASP and we have increased our customers to use our red emitters..

Got it, okay. And where there any other, I mean if go through the numbers you gave there was less than a million in commercial non-red green or green host material, am I correct in that first, because of the numbers aren’t or is it exact, so..

Natural material you mean?.

Commercial blue or yellow I guess within?.

This is miscellaneous materials..

Okay, so it’s a general number not specific to yellow or blue.

And have you gotten to a point where you have qualified other host materials with customers and they are now able to be designed in at some point or you’re still at the kind of show stage with other host materials?.

We are sampling with other customers and we are continuing to sample it with multiple customers at this time..

Got it, okay thanks..

Thanks Andy..

[Operator Instructions] We’ll go back to Jim Ricchiuti with Needham & Company..

The royalty and license fees in the quarter, $5.4 million kind of standout just if we go back to previous quarters, I mean it’s roughly 15%, 16% of revenues without Samsung, and I’m wondering if you could talk a little bit about that, was it in aberration or might we anticipate quarters like this going forward, I know if you can give any senses for the concentration of that with customers?.

I mean clearly you can see, our second largest customer bought a lot more material during this quarter compared to others. And that customer we report part of the sale of the material as a license fee. So that is a pretty big piece of it..

Okay..

There are some other – other licenses, amortization of upfront fees and stuff like that..

Okay, so excluding that second largest customer, it’s not as if there was another was there a high concentration from another customer or is it fairly well disbursed?.

It’s not a high concentration from another customer..

Okay, thank you..

And we’ll take a follow up question from Hendi Susanto with Gabelli..

Sid, if I look at your OpEx R&D, you are seeing some decline in Q3, how should we expect R&D in the near-term relative to the levels we are seeing in Q2 and Q3?.

I think it would be more or like Q2, Q3 as I said little earlier included in that our scale up cost from PPG industry are commercializing new materials and R&D. And in this quarter, it was lower than in prior quarters..

And then would you be able to give some insight on how firm the Chinese OLED display manufacturers is planning to proceed, like I think we have been hearing that for quite a while.

I’m wondering whether you have some the data point on like to know how that plan is?.

Well, Hendi, we obviously cannot speak for our customers. But we are seeing increased interest in activity in China..

Okay, thank you..

Thank you. Thank you again everyone..

Thank you. This concludes our question-and-answer session. I would like to turn the program back over to Sid Rosenblatt for any additional or closing remarks..

Thank you for your time again today. And we appreciate your interest and support and good night everyone..

Thank you everyone. That does conclude today’s conference. We thank you for your participation..