OLED inkjet printing equipment manufacturer Kateeva plans to lay off 144 employees including senior executives!

OLED manufacturing startup Kateeva plans to lay off 144 employees, according to a filing with the State of California.

According to foreign media Crunchbase, Kateeva's chief human resources officer Monica Kaldani-Nasif wrote in a letter to the state Employment Development Department on January 27 that the company would lay off 144 employees. A subsequent notice from the U.S. Employment Development Department stated that the layoffs would take effect on January 31.

The letter reads: "The company plans to lay off 144 employees on the day of layoffs in order to reduce the company's current manpower. However, for some of these employees, we will provide a 60-day transition period."

The reporter noted that the 60-day transition period will only apply to employees marked with “*” in the document excerpted above.

Kaldani-Nasif also wrote that the company will provide certain compensation to employees who did not receive the 60-day transition period. According to regulations, companies and businesses in California need to give 60 days' notice before large-scale layoffs.

According to the letter, the layoffs involve a range of positions from software engineers to senior research and development directors. In addition, some senior executives including president, chief marketing officer and chief operating officer are also on the layoff list, but these people basically have a 60-day transition period.

Kateeva, based in Newark, California, has developed inkjet printing technology that can be used for mass production of OLED screens.

According to Crunchbase, Kateeva has raised $126 million from investors including Sigma Partners and TCL Capital. The company's last round of financing (Series E) was in May 2016, when it raised $88 million.

We reached out to Kateeva via a news email on Wednesday afternoon but have yet to receive a response.

Zhou Hua, chief analyst of the display industry at CINNO Research, said that inkjet printing technology is considered to be the next-generation film-forming technology of the display industry and an important direction for the development of the display semiconductor industry. Many next-generation display technologies need to rely on inkjet printing, such as printed OLED, QD OLED, etc. Kateeva is a leading company in the field of inkjet printing. It has in-depth cooperation with many industry companies such as Huaxing, BOE, and Juhua in cutting-edge technologies. It has also obtained strategic equity investment from many customers and hopes to replicate the successful case of TSMC and other foundry companies investing in  ASML in the semiconductor field  .

Investing in cutting-edge technology requires very high capital requirements, and many of the industries Kateeva has invested in in the past are still in the laboratory research and development stage, and the market is not yet mature. As a result, Kateeva's revenue scale is difficult to support its R&D investment, and it needs to rely on market financing to maintain its operations.

Currently, Kateeva's related equipment can be used in the mass production field mainly for the thin film encapsulation process (TFE) of flexible OLED. According to CINNO Research's equipment supply chain data, its market share of TFE inkjet printing equipment in mainland China was about 60% from 2016 to 2019. However, it should be noted that the demand for TFE equipment is limited, and in recent years, many equipment giants have also begun to enter this field, such as LG PRI, Toray, TEL, SEMES and Panasonic, resulting in Kateeva's serious loss of orders in the TFE field in recent years alone.

In the next-generation display technology, Samsung announced last year that it would begin large-scale construction of QD OLED production lines, generating a large demand for inkjet printing equipment. Kateeva hoped to rely on Samsung's orders to improve the company's operations, but Samsung eventually announced that it would give the order to SEMES, leaving Kateeva with almost no return on its years of investment in quantum dot printing. We believe that it was precisely because of the loss of this important order and the increasing difficulty in financing in the market that Kateeva's financial crisis was directly caused, and it had to announce large-scale layoffs.