Lighting and digital screen technology developer Universal Display (NASDAQ:OLED) reported third-quarter results after the closing bell on Thursday, Oct. 29. The results left analyst estimates in the dust, led by an impressive jump in sales of organic light-emitting diode (OLED) materials.

Universal Display's third-quarter results by the numbers

Metric

Q3 2020

Q3 2019

Change

Analyst consensus

Revenue

$117.1 million

$97.5 million

20%

$90.0 million

GAAP net income

$40.5 million

$37.0 million

10%

N/A

GAAP earnings per diluted share

$0.85

$0.78

9%

$0.45

Data source: Universal Display. GAAP = Generally accepted accounting principles.

OLED material sales grew 33% year over year, breathing new life in a stalled business trend. Material sales in the first half of 2020 came in 25% below the comparable year-ago period's results. Universal Display's largest manufacturing partners, South Korean electronics giants Samsung and LG Display (NYSE:LPL), are running their production lines at full speed again and are introducing a number of innovative products showcasing the unique properties of OLED displays.

OLED screens can be printed on foldable materials, opening up many new product ideas. Samsung has foldable phone screens on the market today, and you'll soon be able to buy big-screen TV sets where the OLED screen can be rolled up when you're not using it. Samsung is also working with PC processor giant Intel (NASDAQ:INTC) and software titan Microsoft (NASDAQ:MSFT) to create a 17-inch OLED screen that can be used as a tablet or a monitor, but that can also be folded at a 90-degree angle to give you a smaller laptop with a keyboard on the lower touchscreen.

Transparent OLED screens can put lighting panels or important information in new places. In August, LG Display shipped transparent OLED displays to the subway systems in Beijing and Shenzhen, adding train schedules and other information to the windows of subway cars. CEO Steven Abramson expects transparent screens to show up soon in self-driving cars, smart homes, and airplanes.

A businessperson points to financial data and charts floating in midair.

Financial presentations can really look like this, thanks to transparent OLED screens. Image source: Getty Images.

What's next?

While these next-generation OLED products make their way to the global consumer market, Universal Display's technology has found a stable home in the smartphone and big-screen TV industries. Apple (NASDAQ:AAPL) not only included OLED screens in all four of this year's iPhone 12 models, but also highlighted the OLED screen as a significant selling point.

So Universal Display can operate from a stable financial platform with an eye toward many new markets with exponential growth potential in the coming years. The stock isn't cheap at 92 times trailing earnings and 25 times trailing sales, but it's worth every penny. We are still in the early days of Universal Display's long-term growth story.