Everlight Chairman Robert Yeh recently refuted market rumors in Taiwan claiming the company’s decision to use Chinese manufacturers LED chips in its products has impacted Epistar’s revenue performance, according to a UDN report.
A previous report claimed Everlight will be using Chinese manufacturers LED chips in its LED luminaires and light sources sold in the Indian market.
In response, Yeh noted the budget and percentage of LED chips procured from Chinese manufacturers remained low. Epistar and other Taiwanese LED chip manufacturers are still the company’s main suppliers, and Everlight will prioritize supporting compatriot LED companies.
Although, Epistar’s LED chip prices are higher than Chinese manufacturers, it is able to lower costs through its production process and meet client product spec demands, said Yeh. “Epistar is still Everlight’s major (LED chip) supplier”, added Yeh.
Everlight adjusts product portfolio and business strategy
The Taiwanese LED manufacturer has achieved double digit growth to reach NT$ 7.06 billion (US $210 million) this year, despite of the global economy downturn, reported Liberty Times. The Taiwanese LED manufacturer gross margin for second quarter reached 22.25%, compared to Epistar’s 9% to 12%, and LED package manufacturer Unity Opto’s 13.62%, and Lextar’s 10.7%.
Everlight has achieved higher revenue growth than other Taiwanese companies because of its diversified product portfolio, analyzed the Liberty Times report. The company has alleviated impact from major LED lighting application markets with its diverse product strategy, such as TV backlight and lighting. These two major lighting application sectors amount to less than 25% of the company’s revenue source. The remaining revenue sources are divided among its diverse product portfolio that includes photo couplers, flash lights in smartphones, LED light bulbs in residential market, displays and others.
The same report also claimed Everlight would be releasing a high voltage LED bulb on the market with a retail price of US $0.9 by the end of this year.
In contrast, Epistar is still largely focused on the LED TV backlight market, and has been hit hard by waning market demands this year.
Moreover, the company has made several adjustments in its business strategies to cope with the challenging market conditions, according to the UDN report. Although, LED lighting has shown soaring growth over the years, Everlight announced its decision to withdraw from the end market sector of manufacturing LED bulbs, and turn its focus towards developing LED lighting components or lighting solutions. The company is integrating LED chips with light sources, and will no longer be involved in the assembly of LED bulbs.
The LED market outlook for 2016 remained uncertain, said Yeh. The economic downturn, and ongoing industry restructures will make it difficult to make accurate market projections, but in the time being the company is investing on new solutions to attract more clients.
