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9 January 2013

Declining pricing, softening demand and uncertain economy still troubling opto market

Rapidly declining pricing, softening demand and a still uncertain global economy are creating challenges for manufacturers at all stages of the optical industry supply chain, according to the Strategy Analytics GaAs and Compound Semiconductor Technologies Service (GaAs) viewpoint ‘Compound Semiconductor Industry Review July - September 2012: Optoelectronics, Materials and Equipment’.

Most firms that manufacture equipment, material and devices for LEDs, optoelectronic devices and photovoltaic devices are seeing declining revenue and income, or outright losses, adds the report, which summarizes technology, product, contract, financial and employment announcements in the July-September 2012 quarter from firms such as Soitec, AIXTRON, AXT, Hitachi Cable, JDSU, Finisar, Oclaro, EMCORE, GigOptix, IQE, Kopin, Cree, OpNext, First Solar and Spire.

But despite declining financials at many of these companies, the report concludes that product development activities remain strong, with the announcement of several new LED and higher-data-rate optical components.

“With a few notable exceptions like Dowa, First Solar and Cree, most of the other companies in this report struggled to increase revenue and income,” notes Eric Higham, director of the Strategy Analytics GaAs and Compound Semiconductor Technologies Service (GaAs). “Companies in the LED and equipment market are trying to address rapidly declining prices in conjunction with declining demand, and they are finding it difficult to increase revenue and income in this environment,” he adds.

“Companies in the optical component segment of the supply chain are developing products for higher-data-rate networks, but most of the equipment orders at the front-end of the optical supply chain are going to research institutions rather than production expansions,” comments Asif Anwar, director of the Strategy Analytics Strategic Technologies Practice (STP).

Tags: Strategy Analytics

Visit: www.strategyanalytics.com

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