The nation’s two leading LED companies last month posted their lowest revenue since February 2013 due to weak demand and Chinese competition.
Epistar Corp (晶電). the nation’s top LED chip supplier, saw its revenue drop 17.87 percent annually to NT$1.49 billion (US$50.9 million) last month, it said in a filing with the Taiwan Stock Exchange
On a monthly basis, revenue contracted for a second straight month, falling 20.32 percent from January’s NT$1.87 billion, it said.
Combined revenue in the first two months of the year fell by a milder 3.76 percent year-on-year to NT$3.37 billion, it said.
Epistar’s sluggish sales reflects persistent pressure from Chinese competition, analysts said.
Sanan Optoelectronics Co Ltd (三安光電), Epistar’s biggest rival, in December announced plans to spend 33.3 billion yuan (US$5.26 billion) to expand its production capacity in the next five years.
The Chinese LED giant’s move has raised concerns over worsening oversupply, especially for blue/white LED chips, analysts said.
Sanan’s expansion plan would weigh on already-low average selling prices for blue/white LED chips, affecting Epistar’s operations, they said.
Epistar has been adjusting its product portfolio by focusing on higher-margin products, such as four-element LED products, mini LEDs and vertical-cavity surface emitting laser (VCSEL) components.
Epistar president M.J. Chou (周銘俊) in December told a LED forum that the company expects production of mini LEDs for smartphones to ramp up in the April-to-June quarter.
A 6-inch production line for VCSEL components is also to begin trial runs in the same quarter, he said.
Everlight Electronics Co (億光), the nation’s leading LED chip packaging and testing, and lighting products provider, also saw a 17.34 percent year-on-year contraction in sales to NT$1.76 billion last month, it said in an exchange filing.
Revenue in the first two months of the year shrank 0.46 percent annually to NT$4.16 billion.
Everlight chairman Robert Yeh (葉寅夫) last month told reporters that Taiwanese LED companies would continue to face price-cutting competition from their Chinese peers in the backlight market this year.
The company plans to increase shipments of infrared, mini LED and flash lights used in smartphones this year to offset the impact of lower-margin products, such as backlight units and consumer lighting products, Yeh said.
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