GPI Bets on CSP LEDs to Boost its Revenue in 2016

Intense competition in the LED market will spur the LED market into a new phase, and with Nichia’s white LED patents expiring in 2017, Taiwanese LED chip maker Genesis Photonics Inc. (GPI) is focusing on the emerging flip chip LED and CSP LED market, said the company Chairman David Chung in a recent interview with China Post.

The emerging flip chip LED and CSP LED market have higher retail price and high technology entry level, which could boost the company’s revenues.

GPI’s CSP LED chip technology is an extension of its flip chip LED technology, he added. By integrating core technologies, the company has overcome yield rate issues and commercialized CSP LEDs. The LEDs are being sold in the automotive lighting industry after market, and in the the company aims to expand its applications in LCD TV, smartphones, and compensate lighting applications in the future, which he projected could improve the company profits.

Additionally, the company has started to adjust its production capacity for 2016. GPI estimates it will be upgrading all of its 2-inch MOCVD equipment to 4-inch MOCVDs by March 2016. The equipment upgrade is expected to raise the company’s production utilization rates, and push up CSP LED revenue share to 40% to 50% by the end of 2016.

In response to Chinese manufacturers activities on the market, Chung noted the Chinese government has scaled down its subsidies for upstream LED chip manufacturers, and is currently targeting semiconductor industry. Hence, LED chip price falls have eased, and the price market will be less volatile in the near future. However, future LED chip price developments require further observations, since companies still have fairly high production capacity, and market competition remains fierce, Chung warned.