Most Chinese LED manufacturers report profit in 3Q16


By BizLED Bureau

Chinese LED manufacturers have released their financial reports for third quarter of 2016. LEDinside has collected the financial data of 32 Chinese LED manufacturers for assessment of the credibility of market claims with regards to current development across LED industry.

This data indicates that out of 32 LED manufacturers, 29 posted revenue growth, whereas the remaining three (Lens Technology, Tongfang Lighting, and ETI reported losses for third quarter of 2016. As a whole, most Chinese LED companies witnessed solid net profit growth, and a majority of 23 firms posted revenue growth.

Stellar performers

While San’an Opto leads the way in the LED chip segment, HC Semitek also delivered stellar performance in 2016.HC Semitek’s LED business soared in 2016 and, it also witnessed surging net profits after it consolidated revenues from Crystaland.

Although Changlight’s net profits slowed down, its revenue soared up in 3Q16. Further, it is one of the largest AlInGaP (red) LED chip manufacturer in China, and holds strong prospects in the next-generation red light market.

Auckson Opto’s profits from its LED business reached 19% of its net revenue in the first quarter of 2016. Despite its LED profit for first half of 2016 falling 37.12%, the company has bounced back in the third quarter to deliver 8.87% profit growth.

Most Chinese LED manufacturers report profit in 3Q16   

 ETI’s revenue and net profit fell during the third quarter. However, the company has been setting up its market strategy in the flip chip market, hence the vision of the company remains an optimistic one.

In the LED package segment, Refond OptoNationstar and Jufei Opto posted net profits for the first three quarters and, Mason Technology and Honglizhihui also delivered strong performances.

Changfang Lighting is focusing on developments in the education sector, and has established an education fund. As these companies pick up developments in emerging markets, manufacturers are now deploying their market strategies to reduce LED revenue share in upcoming company earnings.

Mediocre performers

In the end market segmet, Foshan Lighting, Opple Lighting and Yankon Lighting emerge as top representatives. Opple is now listed on the market, and has jointly deployed its smart LED solutions for residential applications, thus offering future prospective growth.

Having emerged from the shadows of lawsuits, Foshan has transformed its LED business, and have now stepped into LED lighting market. Foshan’s net profits have increased at a whopping rate of 280% in third quarter.

Yankon Lighting used it’s spun out LED brand to boost its market deployment in the potential smart lighting sector. Hence, it can be said that conventional manufacturers are now transforming their business models to boost their entry into chief distribution channels.

The rapid developments in OLED impacted the backlight market which has forced LED display technology to redefine itself and provide a more flexible design. This explains why micro-LEDs are beginning to take the limelight in the industry.

While the LED industry is mostly concentrated with increasing market competition, LED chip and flip chip applications have revealed large LED companies are becoming larger.

Such a situation has caused LED manufacturers to go for high gross margin markets in LED or non-LED sectors. Nonetheless, the industry is now beginning to pick up pace, and LED market is becoming progressively marginalized.