Sapien Semiconductor is showing strong performance. Expectations are rising as the large-scale mass production timeline approaches, following the correction of the joint development and supply contract details for display driver chips. Previously, Sapien Semiconductor revised the scale and duration of the joint development and supply contract for display driver chips. The contract size increased from 4.8 billion KRW to 9.5 billion KRW. Given that the contracting party is a big tech company based in California, USA, Sapien Semiconductor's role in the global augmented reality (AR) device market is expected to grow significantly.
As of 11:49 AM on the 17th, Sapien Semiconductor is trading at 21,450 KRW, up 9.1% from the previous trading day.
Jongseon Park, a researcher at Eugene Investment & Securities, explained, "The original contract was disclosed on August 26 last year, with a contract amount of approximately 4.8 billion KRW and a contract end date of October 31 this year. The contract amount has significantly increased from about 4.8 billion KRW to 9.5 billion KRW, which corresponds to 297% of Sapien Semiconductor's annual sales in 2023."
He added, "The contract end date has been extended by about seven months to May 27 next year. Since related technology development is already underway, this is expected to mark the start of large-scale mass production, which is positive news."
He further analyzed, "The contract end date is the scheduled payment date after product delivery. With the market anticipating the global launch of third-generation AR devices by major companies in 2027, Sapien Semiconductor is actively responding to the large market by supplying prototypes of the developed products."
Sapien Semiconductor specializes in DDIC (Display Driver IC) for next-generation flat panel displays such as micro LED and mini LED displays. Their products are used in ultra-small devices for augmented reality (AR) and mixed reality (MR). Researcher Park noted, "Meta's Orion AR glasses adopt LEDoS (silicon-based Micro-LED) technology. The market expects Meta to release second-generation AR glasses next year and third-generation products in 2027 through this technology."
He continued, "Samsung Electronics stated that its first AR glasses under development will not include a display, but it is known to plan the release of second or third-generation AR devices equipped with microLED in 2026. Although the global LEDoS market share in AR devices is only 18% in 2024, it is expected to reach around 44% by 2030."
Researcher Park explained, "Sapien Semiconductor has established a supply chain with not only domestic but also overseas big tech companies, securing a total solution. Through last year's contract, they plan to supply micro-LED driving CMOS backplanes used in second-generation AR devices by the end of this year." He added, "They are expected to supply products for third-generation AR devices to global big tech companies by the end of 2026. Starting with the launch of second-generation AR devices in the second half of this year, the competition for third-generation releases next year will lead to a significant increase in additional orders from North America, Europe, and Asia."
Researcher Park estimated that Sapien Semiconductor's sales will increase from 18.8 billion KRW this year to 42.8 billion KRW in 2026, 108.8 billion KRW in 2027, and 290.5 billion KRW in 2028. He emphasized, "Starting with turning a profit this year, we expect substantial performance growth from next year. Beginning in the second half of next year, when second and third-generation AR devices are competitively launched, explosive performance growth will be possible in 2027."
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