LCD driver IC design specialists including Novatek Microelectronics, Himax Technologies, Sitronix Technology, Fitipower Integrated Technology, Raydium Semiconductor and FocalTech Systems have internally revised downward their business outlooks for the fourth quarter of 2015 and each estimated revenue decreases of more than 10% sequentially, according to industry sources.
Some of the Taiwan-based LCD driver IC suppliers have also expressed caution about their performance in the first half of 2016, citing mainly increased competition from China-based rivals, which usually offer lower quotes, said the sources.
Inventory levels in both the China and Taiwan panel industry have not seen a substantial rise, while TV demand is expected to rise prior to the 2016 Rio Olympics. However, the LCD driver IC industry is under greater pressure on pricing, the sources observed.
According to sources at IC backend companies, Taiwan-based LCD driver IC companies are negotiating lower manufacturing costs for 2016 indicating they are under pressure to cut prices.
In addition to a growing threat from China-based rivals, Taiwan-based LCD driver IC firms will also be facing competition from MediaTek which will complete its acquisition of ILI Technology (Ilitek) in the second quarter of 2016, industry sources suggested.