Sumitomo signs $200 million LED deal with Cree
Sumitomo Corporation has agreed to buy $200 million of Cree's LED products during the fiscal year ending June 2006.
This latest deal follows purchase agreements made by Sumitomo of $100 million and $160 million for Cree's LED chips during Cree's fiscal 2004 and 2005, respectively.
Sumitomo, which has a distributorship agreement with Cree that extends to June 2007, sells the chips to Japanese packaging companies.
The companies anticipate that the purchases, which are subject to end-customer demand, will be made across Cree's full line of LED chip products and will include MegaBright, XBright, and XThin LEDs.
With Cree's revenue in the region of $100 million per quarter, it is likely that Sumitomo will account for around half of Cree's revenue in fiscal 2006.
"The renewal of our agreement and increased purchase commitments reflects the growth we are forecasting in Japan, and highlights the strength of our partnership with Sumitomo and our Japanese customers," said Cree CEO Chuck Swoboda.
Koichiro Kusano, assistant general manager of Sumitomo's Electronic Division, added: "The continued advances in performance, combined with Cree's respected intellectual property, allow Sumitomo to continue to expand our market share through increasing penetration in growing application segments like LCD backlighting."
