AUO Corp. is sampling MicroLED engines for optical interconnects and expects mass production within three years, chair Peng Shuang-lang said in interviews published Saturday, as the display maker chases AI data-center customers beyond its core panel business.
From screens to photonics
Peng told the Commercial Times that energy efficiency gives MicroLED an edge over legacy laser modules in short-reach links inside racks. AUO is pairing the emitters with glass interposers developed through its TGV (through-glass via) program, aiming to cut signal loss when GPUs talk to optical switches.
New CEO Chang Po-i, in his first media tour after 79 days on the job, said he visited eight fabs in Taiwan and China to map capacity. He highlighted subsidiary successes at Raydium, Dexin Materials, and AUO Crystal Materials as proof the group can supply both display and semiconductor customers.
Capital and partners
AUO is not chasing the largest wafer lines; instead it is licensing packaging steps to server ODMs that already buy its low-power monitors. Peng said two U.S. hyperscalers requested second-source quotes after copper links hit thermal limits in 800-gigabit trials.
Analysts caution that MicroLED yields remain volatile, and AUO must prove it can hit price points against established Coherent and Broadcom modules. Still, the company’s glass expertise could shorten customer qualification if TGV vias replace organic substrates in co-packaged optics.
What investors watch next
Fourth-quarter capex guidance, due with earnings next month, will show whether photonics wins incremental spending or merely reallocates display budgets. For now, Peng said 2026 revenue should grow modestly even as TV panel prices soften, betting that AI adjacencies can offset consumer weakness.
Competitive field
Domestic rivals including Innolux and PlayNitride are pursuing overlapping MicroLED road maps, but AUO argues its glass substrate experience lowers thermal warping in co-packaged modules. Peng said the company will not undercut panel margins to win photonics deals; instead it seeks multi-year service contracts with milestone payments tied to bit-error rates.
Export control officers in Taipei reminded reporters that advanced optical engines still require destination checks when shipped to Middle East data centers, a reminder that overseas fabs do not eliminate compliance work at home.
AUO’s Hsinchu pilot line can currently package 200 optical modules a week, Peng said, enough for customer qualification but not for hyperscale rollouts. The company is negotiating with Japan-based gas suppliers to co-locate purification skids beside the line, reducing contamination risk when glass vias are etched.