Nichia Goes Mini
Nichia (5393.JP) is a top 5 LED producer, and like all LED producers is constantly looking for new markets that can generate higher than corporate margins. Mini-LEDs, smaller-than-normal LEDs that are arranged in a matrix, are a way for LED manufacturers to capture a bit more premium than with generic LEDs typically used in LCD backlights, and with the increased number of LED segments (zones) in mini-LED backlights, LCD display producers are able to increase the contrast of LCD displays to compete with OLED.
Nichia has announced its Light Cluster® mini-LED backlight series and the construction of a production facility for mini-LEDs in Tokushima, Japan. The new facility, which we expect to begin initial production in 3Q this year, will have an initial capacity of 50,000 chips/month, which is expected to increase to 200,000 in a phase 2 expansion and to reach 2m by the end of 2023. The initial mini-LED backlight modules are 16” and 17.3”, targeting notebooks, with other models (type J) scheduled for monitors and smartphones (type M). According to the company, initial capacity for the notebook modules has already been booked.
As Nichia is certainly not the 1st LED producer/packager to develop mini-LED products, they focus on differentiating their mini-LED product by making them brighter than other mini-LED systems. The company says that the system can reach a maximum brightness of 1,000 nits across the screen and 2,000 for local zones, which is about double what the company calls ‘general mini-LED chips’, which allows their system to compare to systems that use ~10x that number of chips to achieve the same brightness and contrast.
Nichia goes further, touting the reduced thickness of the module (16” is 1.62mm) and a unique optical design that keeps LED diffusion to a minimum, meaning that the light from an ‘on’ LED does not leak into an area where the LED is ‘off’. Nichia does admit that the Light Cluster chips are more expensive than other mini-LED chips, but the overall cost, due to the lower number of chips needed, is competitive and also requires less power. Down the road, Nichia expects to be able to reduce power consumption further (↓30%) along with thickness (1.3mm) by the end of 2023. We note that the metrics and comparisons are from Nichia and are not verified at this time by any 3rd party. The company predicts mini-LED penetration rates as shown in the table below. Again, these are company developed forecasts, which typically are a bit on the optimistic side.
Nichia has announced its Light Cluster® mini-LED backlight series and the construction of a production facility for mini-LEDs in Tokushima, Japan. The new facility, which we expect to begin initial production in 3Q this year, will have an initial capacity of 50,000 chips/month, which is expected to increase to 200,000 in a phase 2 expansion and to reach 2m by the end of 2023. The initial mini-LED backlight modules are 16” and 17.3”, targeting notebooks, with other models (type J) scheduled for monitors and smartphones (type M). According to the company, initial capacity for the notebook modules has already been booked.
As Nichia is certainly not the 1st LED producer/packager to develop mini-LED products, they focus on differentiating their mini-LED product by making them brighter than other mini-LED systems. The company says that the system can reach a maximum brightness of 1,000 nits across the screen and 2,000 for local zones, which is about double what the company calls ‘general mini-LED chips’, which allows their system to compare to systems that use ~10x that number of chips to achieve the same brightness and contrast.
Nichia goes further, touting the reduced thickness of the module (16” is 1.62mm) and a unique optical design that keeps LED diffusion to a minimum, meaning that the light from an ‘on’ LED does not leak into an area where the LED is ‘off’. Nichia does admit that the Light Cluster chips are more expensive than other mini-LED chips, but the overall cost, due to the lower number of chips needed, is competitive and also requires less power. Down the road, Nichia expects to be able to reduce power consumption further (↓30%) along with thickness (1.3mm) by the end of 2023. We note that the metrics and comparisons are from Nichia and are not verified at this time by any 3rd party. The company predicts mini-LED penetration rates as shown in the table below. Again, these are company developed forecasts, which typically are a bit on the optimistic side.
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