Universal Display Corporation Announces Third Quarter 2008 Financial Results

For the third quarter of 2008, the Company reported a net loss of $5,302,983, or $(0.15) per diluted share, versus a net loss of $2,960,565, or $(0.08) per diluted share, for the third quarter of 2007.

"The rise in net loss was partially attributable to a decline in revenue of approximately $450,000 and a decrease of $570,000 in interest income, due to reduced rates of return of investments. This quarter also saw an increase in operating expenses, specifically research and development, compared to the third quarter of 2007, which had been lower than average. Operating expenses for the third quarter of 2008 were in line with the prior quarters of 2008," said Sidney D. Rosenblatt, Executive Vice President and Chief Financial Officer of Universal Display.

For the nine months ended September 30, 2008, net loss totalled $14,702,158, or $(0.41) per diluted share, versus a net loss of $12,719,737, or $(0.38) per diluted share for the same period of 2007.

Operating expenses for the third quarter of 2008 were $8,458,503, compared to $7,150,030 for the same period of 2007, and $24,357,777 for the nine months ended September 30, 2008, compared to $23,647,095 for the same period of 2007.

Cash used in operating activities was $522,950 and $6,801,677 for the three months and nine months ended September 30, 2008, compared to $2,575,906 and $9,450,432 for the same periods in 2007. The main reason for reduced cash used in operating activities was that during the third quarter of 2008, the Company received $2,200,000 in fees from customers for licenses, technical assistance and joint development work. The Company recorded these fees as deferred revenue and began recognizing a portion of them in the third quarter.

Revenues for the third quarter of 2008 were $2,625,639, compared to $3,077,281 for the third quarter of 2007. Commercial revenue, which includes commercial chemical revenue, license fees and royalty income, was $1,324,924 for the quarter, compared to $1,368,201 for the third quarter of 2007. Developmental revenue, which includes contract research revenue, technology development revenue and development chemical revenue, were $1,300,715 for the quarter, compared to $1,709,080 for the third quarter of 2007. Commercial revenue stayed relatively constant on a quarter-over-quarter basis because revenues from the Company's licensee, Samsung SDI, were essentially the same.

For the nine months ended September 30, 2008, the Company reported revenues of $7,488,056, compared to $8,407,081 for the same period of 2007. Commercial revenue for the first nine months of 2008 increased to $4,275,476, compared to $3,202,027 for the same period of 2007. Developmental revenue for the first nine months of 2008 decreased to $3,212,580, compared to $5,205,054 for the same period of 2007.

"Commercial revenue remained constant during the third quarter of 2008 when compared with the same quarter of 2007, and increased for the first nine months of 2008 versus the same period in 2007. We are encouraged by the continued adoption of and new opportunities for our UniversalPHOLED technology," said Mr. Rosenblatt. "While Samsung SDI's production capacity remained on level with the same quarter of 2007, they reported that their AMOLED displays are being increasingly integrated into mobile devices like cell phones and MP3 players. In addition, Samsung SDI has showcased recent product prototypes for AMOLED televisions and larger area displays, flexible OLED screens, and more. It is clear they are committed to AMOLED display production both financially and developmentally."

Mr. Rosenblatt continued, "The quarter also saw a number of exciting developments in using UniversalPHOLED technology for white lighting applications. During the quarter, we announced a technology license agreement with Konica Minolta for white lighting devices and applications, and we continued to make significant advances in the brightness and lifetime of our white OLEDs. At this time, we view white lighting as a potentially lucrative second revenue stream for our technology in the near future."

The Company's balance sheet remained strong at quarter end, with cash, cash equivalents and short-term investments totalling $79,059,836 as of September 30, 2008, compared to $83,659,657 as of December31, 2007.

Mr. Rosenblatt concluded, "We continue to prudently manage our resources. Our operating expenses averaged approximately $8.1 million per quarter for the first three quarters of 2008, compared to operating expenses for the year 2007 that averaged approximately $7.9 million per quarter. This is consistent with our expectations."

In conjunction with this release, Universal Display will host a conference call, followed by a question and answer session, on Thursday, November 6th, at 5:00 p.m. Eastern Time. Interested parties may participate by calling 706-634-1395 at 4:55 p.m. Eastern Time and referencing conference PIN 70942431. A taped replay of the conference call will be available within two hours of the conclusion of the call and will remain available through Saturday, December 6th, 2008. The number to call for the taped replay is 800-642-1687 and the conference PIN is 70942431.

The conference call will be simultaneously broadcast live over the Internet through a webcast on the Universal Display website. To access the call, please visit the website at http://tinyurl.com/5cvkxg. An online archive of the webcast will be available within two hours of the conclusion of the call.

About Universal Display Corporation

Universal Display Corporation is a world leader in developing and commercializing innovative OLED technologies and materials for use in flat panel displays, solid-state lighting products, electronic communications and other opto-electronic devices. Universal Display is working with a network of world-class organizations, including Princeton University, the University of Southern California, the University of Michigan, and PPG Industries, Inc. Universal Display has also established numerous commercial relationships with companies such as Chi Mei EL Corporation, DuPont Displays, Inc., Konica Minolta Technology Center, Inc., LG Display Co., Ltd., Samsung SDI Co., Seiko Epson Corporation, Sony Corporation, Tohoku Pioneer Corporation and Toyota Industries Corporation. Universal Display currently owns or has exclusive, co-exclusive or sole license rights with respect to more than 850 issued and pending patents worldwide.

Universal Display is located in the Princeton Crossroads Corporate Center in Ewing, New Jersey. Universal Display's state-of-the-art facility is designed to further technology and materials development, technology transfer to manufacturing partners and work with customers to develop OLED products that meet their needs. Visit Universal Display on the Web at www.universaldisplay.com.

All statements in this document that are not historical, such as those relating to Universal Display Corporation's technologies and potential applications of those technologies, are forward-looking statements within the meaning of the Private Securities Litigation Reform Act of 1995. You are cautioned not to place undue reliance on any forward-looking statements in this document, as they reflect Universal Display Corporation's current views with respect to future events and are subject to risks and uncertainties that could cause actual results to differ materially from those contemplated. These risks and uncertainties are discussed in greater detail in Universal Display Corporation's periodic reports on Form 10-K and Form 10-Q filed with the Securities and Exchange Commission, including, in particular, the section entitled "Risk Factors" in Universal Display Corporation's annual report on Form 10-K for the year ended December 31, 2007. Universal Display Corporation disclaims any obligation to update any forward-looking statement contained in this document.

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES CONSOLIDATED BALANCE SHEETS (UNAUDITED) September 30, December 31, 2008 2007 ASSETS CURRENT ASSETS: Cash and cash equivalents $ 54,415,132 $ 33,870,696 Short-term investments 24,644,704 49,788,961 Accounts receivable 1,792,761 2,395,416 Inventory 2,209 41,165 Other current assets 649,900 673,931 Total current assets 81,504,706 86,770,169 PROPERTY AND EQUIPMENT, net 13,275,767 13,525,714 ACQUIRED TECHNOLOGY, net 3,353,112 4,624,416 OTHER ASSETS 72,272 79,772 Total assets $ 98,205,857 $ 105,000,071 LIABILITIES AND SHAREHOLDERS' EQUITY CURRENT LIABILITIES: Accounts payable $ 1,673,009 $ 861,428 Accrued expenses 4,733,161 4,578,147 Deferred license fees 6,148,268 7,178,268 Deferred revenue 1,787,634 172,688 Total current liabilities 14,342,072 12,790,531 DEFERRED LICENSE FEES 3,577,437 2,454,900 DEFERRED REVENUE 375,000 538,683 Total liabilities 18,294,509 15,784,114 SHAREHOLDERS' EQUITY: Preferred Stock, par value $.01 per share, 5,000,000 shares 2,000 2,000 authorized, 200,000 shares of Series A Nonconvertible Preferred Stock issued and outstanding (liquidation value of $7.50 per share or $1,500,000) Common Stock, par value $.01 per share, 50,000,000 shares 360,297 355,632 authorized, 36,029,665 and 35,563,201 shares issued and outstanding at September 30, 2008 and December 31, 2007, respectively Additional paid-in capital 255,591,116 250,240,994 Unrealized loss on available for sale securities (7,440 ) (50,202 ) Accumulated deficit (176,034,625 ) (161,332,467 ) Total shareholders' equity 79,911,348 89,215,957 Total liabilities and shareholders' equity $ 98,205,857 $ 105,000,071

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Three Months Ended September 30, 2008 2007 REVENUE Commercial revenue $ 1,324,924 $ 1,368,201 Developmental revenue 1,300,715 1,709,080 Total revenue 2,625,639 3,077,281 OPERATING EXPENSES: Cost of chemicals sold 266,563 281,062 Research and development 5,750,361 4,568,299 General and administrative 2,342,962 2,209,537 Royalty and license expense 98,617 91,132 Total operating expenses 8,458,503 7,150,030 Operating loss (5,832,864 ) (4,072,749 ) INTEREST INCOME 545,561 1,114,769 INTEREST EXPENSE (15,680 ) (2,585 ) NET LOSS $ (5,302,983 ) $ (2,960,565 ) BASIC AND DILUTED NET LOSS PER COMMON SHARE $ (0.15 ) $ (0.08 ) WEIGHTED AVERAGE SHARES USED IN COMPUTING BASIC AND DILUTED NET 35,989,473 34,985,918 LOSS PER COMMON SHARE

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF OPERATIONS (UNAUDITED) Nine Months Ended September 30, 2008 2007 REVENUE Commercial revenue $ 4,275,476 $ 3,202,027 Developmental revenue 3,212,580 5,205,054 Total revenue 7,488,056 8,407,081 OPERATING EXPENSES: Cost of chemicals sold 709,001 727,650 Research and development 15,955,238 15,565,452 General and administrative 7,396,452 7,131,268 Royalty and license expense 297,086 222,725 Total operating expenses 24,357,777 23,647,095 Operating loss (16,869,721 ) (15,240,014 ) INTEREST INCOME 2,202,123 2,523,467 INTEREST EXPENSE (34,560 ) (3,190 ) NET LOSS $ (14,702,158 ) $ (12,719,737 ) BASIC AND DILUTED NET LOSS PER COMMON SHARE $ (0.41 ) $ (0.38 ) WEIGHTED AVERAGE SHARES USED IN COMPUTING BASIC AND DILUTED NET 35,887,264 33,230,574 LOSS PER COMMON SHARE

UNIVERSAL DISPLAY CORPORATION AND SUBSIDIARIES CONSOLIDATED STATEMENTS OF CASH FLOWS (UNAUDITED) Nine Months Ended September 30, 2008 2007 CASH FLOWS FROM OPERATING ACTIVITIES: Net Loss $ (14,702,158 ) $ (12,719,737 ) Non-cash charges to statement of operations: Depreciation 1,421,274 1,347,549 Amortization of intangibles 1,271,304 1,271,304 Amortization of premium and discount on investments (942,761 ) (189,306 ) Stock-based employee compensation 895,869 803,693 Stock-based non-employee compensation 4,119 9,497 Non-cash expense under a Development Agreement 882,540 745,453 Stock-based compensation to Board of Directors and Scientific Advisory Board 345,691 318,997 (Increase) decrease in assets: Accounts receivable 602,655 (376,575 ) Inventory 38,956 28,389 Other current assets 24,031 (139,669 ) Other assets 7,500 7,500 Increase (decrease) in liabilities: Accounts payable and accrued expenses 1,805,503 (526,381 ) Deferred license fees 92,537 (383,700 ) Deferred revenue 1,451,263 352,554 - - Net cash used in operating activities (6,801,677 ) (9,450,432 ) CASH FLOWS FROM INVESTING ACTIVITIES: Purchases of property and equipment (1,171,327 ) (661,591 ) Purchases of investments (62,028,220 ) (27,344,981 ) Proceeds from sale of investments 88,158,000 22,543,000 Net cash provided by (used in) investing activities 24,958,453 (5,463,572 ) CASH FLOWS FROM FINANCING ACTIVITIES: Proceeds from the issuance of common stock - 38,000,023 Proceeds from exercise of common stock option and warrants 2,387,660 6,422,284 Net cash provided by financing activities 2,387,660 44,422,307 INCREASE IN CASH AND CASH EQUIVALENTS 20,544,436 29,508,303 CASH AND CASH EQUIVALENTS, BEGINNING OF YEAR 33,870,696 31,097,533 CASH AND CASH EQUIVALENTS, END OF PERIOD $ 54,415,132 $ 60,605,836

SOURCE: Universal Display Corporation

Universal Display Corporation Dean Ledger, 800-599-4426 or Gregory FCA Communications Investor contact: Paul Johnson, 610-642-8253 (x115) paul@gregoryfca.com or Media contact: Matt McLoughlin, 610-642-8253 (x129) matt@gregoryfca.com