SAN JOSE, Calif. Japanese distribution giant Sumitomo Corp. has agreed to purchase $180 million worth of Cree Inc.'s light-emitting diode (LED) and wafer products over the next year.
Both companies anticipate that purchases will be made across Cree's full line of wafer and LED chip products. The procurement will be made during Cree's fiscal year ending June 2007, subject to end-customer demand and other conditions.
The $180 million procurement represents approximately a 10 percent increase over Cree's current estimate for fiscal 2006 sales to Sumitomo.
Sumitomo made the purchase commitment pursuant to its existing distributorship agreement with Cree (Durham, N.C.). Cree previously announced that sales to Japan in fiscal 2006 were running below the original plan for the year.
"We believe the agreement reflects the increasing optimism our sales team sees in Japan for increased market share in white mobile applications and new design wins in emerging markets for LED lighting," said Chuck Swoboda, Cree's chairman and chief executive, in a statement.