LED chip factory Zhaoyuan Optoelectronics changed its name

On December 26, 2025, TCL Technology officially announced that its subsidiary TCL CSOT successfully won 80% of the equity of LED chip manufacturer Fujian Zhaoyuan Optoelectronics Co., Ltd., with the final transaction price of 490 million yuan. Yesterday, the acquisition project officially completed the equity delivery, marking that TCL CSOT's layout in the core upstream segment of LED has entered a substantial operational stage.

Zhaoyuan Optoelectronics officially became a holding subsidiary of TCL CSOT and changed its name to "Fuzhou Huazhao Optoelectronics"

On March 1, TCL CSOT officially announced the completion of equity delivery with Fujian Electronic Information Group. This move marked the complete legal and administrative settlement of TCL CSOT's equity acquisition project for Zhaoyuan Optoelectronics. With the delivery ceremony held, Zhaoyuan Optoelectronics officially changed its name to "Fuzhou Huazhao Optoelectronics Co., Ltd.". As a holding subsidiary of TCL CSOT, it has become an important strategic support point in the upstream semiconductor materials and core chip fields.

Zhao Jun, senior vice president of TCL Technology Group and CEO of TCL Huaxing, pointed out that the core driving force for the acquisition of Huazhao Optoelectronics is to achieve all-round synergy of "technology + production capacity + market", which reflects TCL Huaxing's attempt to form a closed-loop advantage in Micro/Mini LED technology research and development, production line scheduling and terminal market influence.

Huazhao Optoelectronics was established in March 2011 with a registered capital of 1.437 billion yuan. It is mainly engaged in the research and development, production and sales of LED epitaxial wafers and LED chips. It has a complete LED chip production line, large-scale production capacity and business foundation. In 2024, Huazhao Optoelectronics achieved revenue of 880 million yuan and a net loss of 389 million yuan; from January to October 2025, revenue was 710 million yuan and a net loss of 299 million yuan.

Huazhao Optoelectronics' continued losses reflect the multi-dimensional risks and challenges faced by chip factories that lack the support of downstream terminal channels in the context of overcapacity and fierce price wars in the mid- to low-end lighting chip market. However, with the control of TCL Huaxing, the focus of its production lines will quickly shift to high value-added display backlights, Mini LED direct display and automotive lighting. Relying on the order support and management empowerment of large groups, Huazhao Optoelectronics' profitability is expected to be significantly optimized.

Mainstream panel manufacturers and brands are "camped" in core links, and vertical integration is deepening

As Micro/Mini LED technology gradually matures, the importance of LED chips in LED display and even the entire semiconductor display field continues to highlight. In order to ensure supply chain security and reduce technology collaboration costs, global mainstream manufacturers are accelerating their expansion into upstream chip links.

In recent years, panel manufacturers and terminal brands have established their own "bases" in the field of LED chips through mergers and acquisitions, equity investments, or self-built factories. According to TrendForce’s analysis, since 2018, the trend of upstream penetration initiated by panel giants or terminal brand manufacturers has become irreversible. In this "camping camp" competition, the paths of major mainstream manufacturers have their own characteristics, but the ultimate goal is to ensure supply chain security and technology exclusivity.

Samsung and AUO: The former invested in Nitron to promote Micro LED TV, while the latter took the lead in mass-producing Micro LED watches and Micro LED car communication displays by investing in Fucai and Nitron.

Hisense: After joining Qianzhao Optoelectronics, it successfully launched an RGB Mini LED backlight TV based on a self-developed link, strengthening its competitiveness in the ultra-high-end TV market.

BOE: By controlling Huacan Optoelectronics, it has built a vertical system from chips to glass-based Micro/Mini LED;

Huike: Mass production of Mini LED displays will be achieved in 2023, and the self-built chip factory will further enhance the cost advantage of collaboration.

TCL Huaxing: The Suzhou Mini LED display production line has been put into operation in 2025. The current monthly production capacity reaches 6,000 square meters. In the future, it is expected to use Huazhao Optoelectronics to strengthen product competitiveness and comprehensive competitiveness.

The integration of the upstream core material links of LED by mainstream brands and major panel manufacturers has on the one hand increased the intensity of competition, and on the other hand will also play a major role in boosting the Micro/Mini LED industry.

According to TrendForce Consulting’s analysis, the trend of large-scale vertical integration will significantly reduce the collaboration costs between product applications and chip supply. Through large-scale production and technology collaboration, the development of Micro/Mini LED technology in the display and non-display markets is expected to accelerate, thereby driving the continued growth of the LED chip market output value.

The LED chip market structure will be reconstructed in the future, and cross-border integration will be further deepened

According to data from TrendForce, the total output value of the global LED chip external sales market in 2025 is expected to be US$2.841 billion. In the ranking of manufacturers, Huazhao Optoelectronics ranks ninth in the world.

With Huike's self-built chip factory, Huazhao Optoelectronics being controlled by TCL CSOT, and the market share of BOE Huacan Optoelectronics and Qianzhao Optoelectronics gradually transforming into a "domestic supply + export sales" model, the traditional LED chip market has gradually shifted from a "pure supplier model" to a "semi-closed loop ecological model." This means that the living space of non-vertically integrated chip factories in the high-end backlight and direct display markets will be squeezed to a certain extent. In the future, the competitive landscape of the LED chip market will change.

At the same time, as panel giants complete the layout of the entire industry chain, pure downstream LED display manufacturers will face pressures in technology, cost, supply and other aspects, and the competitive environment will become increasingly severe.

Technology generation gap: Vertically integrated manufacturers can achieve a perfect match between chip design and backplane driver, thus widening the gap in image quality performance.

Cost disadvantage: Manufacturers with the ability to produce their own chips have an advantage in the BOM cost of Micro/Mini LED products.

Supply barriers: In the early stages of new technology iterations, top-spec Micro LED chip production capacity may be given priority to parent company brands, causing second-tier manufacturers to face a similar situation of being unable to obtain high-quality chip resources first.

Against this background, LED display manufacturers are also improving their comprehensive competitiveness through cross-field technology integration. Currently, the LED display industry has transcended traditional hardware boundaries and evolved towards a higher-dimensional "scenario-based cross-border integration". For example, downstream display screen manufacturers are actively integrating content production, film and television production, AI algorithms, etc. to build themselves into a system-level display solution provider.

Conclusion

With the acceleration of technology iteration, especially the gradual maturity of Micro LED technology, companies that have mastered the "puzzle" of chip design and manufacturing are expected to occupy the most powerful command position in the next round of display technology revolution.

At the same time, as the boundaries between panel factories, chip factories and terminal brands gradually dissolve, cross-border integration will become the engine driving the industry's growth in the second half. In the future, LED displays will also serve as ubiquitous interactive interfaces, deeply embedded in every corner of semiconductors, smart cars, smart education and medical care, and digital entertainment.