Driven by surging demand from the lighting, tablet and mobile backlighting segments, global revenues for GaN LED climbed 10.6% in 2013, but this could mark the last hurrah for the era of double-digit dollar growth for the market, according to IHS.
Worldwide revenues for GaN LEDs rose to US$12.4 billion in 2013, up from US$11.2 billion in 2012. Revenue growth in 2014 is forecast at 4%, with sales totaling US$12.9 billion. Although unit shipments will continue to rise, the market will enter a sustained period of flatness starting in 2015, said IHS.
"The GaN LED market has experienced strong revenue growth in recent years, propelled by the combination of growing demand from the lighting and display backlighting segments," said Jamie Fox, principal analyst for LEDs at IHS. "However, LED backlighting market revenues have begun to decline, although lighting will continue to expand. The combination of the contraction in backlighting and rise in lighting will result in flat revenue for the GaN LED market in the coming years."
While revenue growth will stall, GaN LED unit shipments will continue to rise in the coming years, but at a more moderate pace than before. Following increases of 17.3% in 2013 and 7.3% in 2014, unit shipments will rise in the 3-4% range from 2015-2018.
Backlighting backstory
LEDs are used extensively as backlights for LCD panels.
But backlighting applications including TVs and monitors will soon reach 100% LED saturation. Furthermore, the value of the LEDs in each TV and PC monitor shipped has begun to decline.
Meanwhile, the fast growth of LEDs in tablets is slowing. The backlighting market in this area is starting to mature in terms of LED technology, and shipment levels of the tablet devices also are not growing as rapidly as before.
Overall, the GaN LED backlighting segment is projected to decline to US$3.7 billion in 2018, down from US$4.3 billion in 2013, IHS added.
Lighting the way
In contrast, the GaN LED lighting segment will rise to US$5.9 billion in 2018, up from US$4.2 billion in 2013.
All the GaN LED backlighting applications combined still exceeded the lighting segment in 2013, at US$5.5 billion vs US$4.2 billion. Lighting and backlighting revenues will be on a par with 2014 and 2015, but lighting will take a decisive lead in 2016, IHS noted.
