The decline of LED price affects the profit of enterprises

LED electronic screen enterprises compete in the market with low prices, which has pushed the LED chip industry to a stage of fierce price competition, thus reducing the income of leading enterprises in the industry and making small and medium-sized enterprises face the crisis of elimination. With the release of industrial inventory at the end of the 19th century, the global trend will be challenged in 2020. The whole industrial chain market will be inactive, and production and sales will decrease again. Faced with these serious challenges, large enterprises with capital advantages can switch to higher profit Mini / micro LED chips, and small LED electronic screen enterprises can barely support or survive.
LED chips continue to be cheap, and the profits of LED electronic screen enterprises continue to decline
Due to the release of chips in the industry, the price of LED chips has become low in recent years, the whole market is stable, and the income of LED electronic screen enterprises has continued to decline since 2019. According to the annual report of chip enterprises in 2019, Sanan optoelectronics achieved a revenue of 7.46 billion yuan, a year-on-year decrease of 10.8%. The net profit of guimao was 1.298 billion yuan, a year-on-year decrease of 54.1%. The net profit attributable to shareholders of the listed company of jucan Optoelectronics in 2019 was 8.1443 million won, a year-on-year decrease of 60.02%. Compared with the same period of last year, the price of LED chips of SMIC decreased by 20% – 30%, and the net profit in 2019 decreased by more than 9%. Leading enterprises in the industry said that capital, production scale and market share are very large. According to the financial reports of major enterprises, the profits of LED electronic screen enterprises are basically in a state of decline in 2019, which represents the stagnation of LED chip market.
In 2019, the profits of semiconductor enterprises decreased, but after more than two years of inventory clearing activities, the semiconductor industry began to balance chip supply and demand at the end of 2019. Therefore, from the fourth quarter, many LED electronic screen enterprises began to gain profits, and product prices and profits ushered in the dawn of actively deploying the 2020 market plan. However, since 2020, due to a disease, redevelopment and other reasons, the production capacity has declined, the production progress has slowed down, the active chip market has been silent again, and the income of LED chip enterprises has continued to decline. According to the report of Q1 newspaper in 2020, the performance of seven LED chip listed companies all declined in the first quarter of 2020, and the total gross profit and net interest rate continued to maintain the downward trend of sales in 2019. In the face of the poor development of the traditional market, LED electronic screen enterprises are going deep into various amazing fields to stimulate market development and drive performance growth.